Step 2: Setting up the software
First, if not already done, install the Arduino IDE from www.arduino.cc/en/Main/Software
Second, download the core files from www.avr-developers.com/corefiles/ . There is an instruction on how to install it right on the site, but to make it easy: just unzip the files to arduinoInstallPath\hardware there arduinoInstallPath is the path there you have installed the IDE.
Third, start the Arduino IDE and open File -> Examples -> Arduino ISP.
Fourth, connect your Arduino board to the computer.
Fifth, choose your Arduino board from the Tools -> Board and choose the serial port from Tools -> Serial Port.
Sixth, press upload.
Now you have set up everything on the computer side and made your ISP (Arduino) ready. You are now ready to start setting up your MCU to program.