Both,  Actually it is a combination of Voltage, Amperage (Wire feed speed) and Choice of Shield Gas.

Here is a link to some video clips and downloadable texts that will explain very nicely.

http://millerwelds.com/resources/improving-your-skills/mig/

http://millerwelds.com/pdf/mig_handbook.pdf

Theoretically, the transfer mode is determined by wfs and amperage.  Short-circuit mode, the amperage is low, and the filler actually contacts the base metal, producing the arc.  This mode is what you see used for a lot of sheet metal work, as it produces pretty shallow penetration.  Globular transfer takes place at somewhat higher amperages.  The term "globular" refers to the shape that the filler metal takes as it melts, into droplets.  Globular transfer produces a lot of spatter, but more penetration than SS.  Spray transfer takes place at higher amperages, generally above 175.  In this mode, the filler is melted into very fine droplets, and the arc "sprays" the filler into the weld.  Spray transfer produces little spatter and gets very good penetration.  Since general practice dictates that amperages are lower for out of position welds, anything other than a 1G, 1F, or 2F will be globular.  I hope that explains it a little more easily.  Personally, it took me forever to put that simple lesson into common terms for myself.

Lawrence, those are excellent learning sites.  Anyone who deals in our trade should have those bookmarked!

aerowelder,

please let me - additionally to the great responses coming from Lawrence and Curt - give you another short hint, basing on a discussion a time ago.

http://www.aws.org/cgi-bin/mwf/topic_show.pl?pid=56396#pid56396

Attached there you can find a relatively detailed document treating the different droplet-transfer-modes in Gas Shielded Metal Arc Welding (GMAW) and the influences responsible for their occurrence.

By the way, please let me give you the very latest information in regard to an up-to-date adjustment of the "Classification of Metal Droplet Transfer", we have discussed on the 2007' Annual Assembly of the International Institute of Welding.

It is intended to simplify the representation of the different droplet-transfer-modes in GMAW by having only a few fundamental terms depending on how the droplet-transfer or -detachment respectively, is generated: "Natural" or "Controlled".

This IIW-topic is currently and furthermore in progress.

Regards,
Stephan