Your ISP will know only if you are using up a lot of bandwidth. This will send up a read flag to them. Most ISP's limit the amount of bandwidth you can use per month. So If you were getting a lot of traffic to your site it would eat up all your bandwidth, then your visitors would be unable to connect. Also once you use up your monthly bandwidth your internet speed will be slower than dial up.
Cassianno is right though if you want to host your own site get a Apache, WAMP, or XAMPP and create a no-ip account, and bound the domain to your IPaddress.
If you do this though you will need to port forward port 80 on your router since Apache runs on port 80. Here is some info on port forwarding portforward.com. Just find your router in there list, and follow there guide.
Some ISP's block port 80 though like mine does. So if yours does you will have to do a port 80 redirect. Here is a tutorial on how to do a port 80 redirect:
So your ISP has decided to block port 80?
If your going to host a MMO you might have to forward additional ports depending on how you build your server.
I use to run a quite large World of Warcraft private server so I have some experience with this. When I first started, hosting from home worked just fine for about 100 players or less online at the same time. But once we started averaging 1000 players online 24/7 my ISP figured it out so I rented a VPS for $40 per month. That only lasted one month because we had grown to averaging over 7000 players online 24/7. After that I we had to rent a PS for about $175 per month.
Anyway, I hope this helps a little.
O'ya I almost forgot to mention another downside to hosting your own site is that you will be a target for skiddies (script kiddies). They love to practice hacking on self hosted sites. Lots of vulnerabilities unless you really know what your doing. So always back up your server or site to someplace other than your hosting PC.