Watch the Closeup online guitar lesson by Larry Carlton from 335 Blues

You can use a really subtle and pretty type of vibrato by adjusting the way you apply pressure to the string. Rather than bending the note up and back, change the pressure you're using to finger the note. Pressing harder and lighter will give you just enough change in pitch to make a difference.
Another subtle vibrato is what I call "close-up vibrato." For this one we're actually sliding up and down the string just a bit. Pull your wrist and thumb away from the neck, so that all the pressure comes straight from your fretting fingers to the string. Then slide back and forth from the middle of the fret towards the fret wire. If you do this once and listen carefully, you'll hear that you're actually dropping the pitch ever so slightly.