In the past, PayPal offered a Premier account which was intended for people who wanted to sell online but, were not a registered business, they just sold under their name. That option is no longer available.
You can also use a personal account to receive money for the sale of goods and services, but if you plan to use your PayPal account primarily to sell things on a regular basis, you should consider a business account. Sounds like you have decided to do that. You can upgrade a personal account to a business account however, a little planning ahead of time is to your advantage. Having a registered business is the better way to go but, do you actually need one at this point as you're just starting out - that's up to you however, you will have to register your SSN and possibly provide some other Tax info. You may want to consider setting up a sole proprietorship as it is the simplest business form under which one can operate a business. The sole proprietorship is not a legal entity. It simply refers to a person who owns the business and is personally responsible for its debts. Here's some additional info.
Here's a snippet from the PayPal User Agreement:
By opening up a business account or upgrading a personal account to a business account, you certify to PayPal that you are using it primarily for a business or commercial purpose. You also consent to PayPal obtaining your personal and/or business credit report from a credit reporting agency at account opening and whenever PayPal reasonably believe there may be an increased level of risk associated with your business account.
