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In order to put an item up for auction, the first thing you must do is talk to an Auctioneer NPC. Auctioneer NPC's can be found in all of the major capitol cities and in all of the goblin cities (Gadgetzan, Booty Bay, Everlook). The Auctioneers in Gadgetzan, Everlook and Booty Bay allow the auctioning of items to both Horde and Alliance players for a greater fee.
To Auction an item: Click on the "Auctions" Tab from the main Auction window. In the top left corner under "Auction Item", there is a box into which you can drag and drop items you wish to sell. The Auction House will suggest a starting price. You can adjust this by setting it higher or lower. In some cases, the suggested price will be much too low for the true value of the item, or it will be set too high. A good way to determine a fair price is to see what other people are selling the same item for, at least until you get the hang of it. A low price will attract more bidders.
Next, you will need to set the auction duration. It's important to realize that the longer you set the Auction Duration, the more the deposit fee will be. If you set an extremely long duration, the deposit price can be more than the actual value of the item. If your item sells, you will receive your deposit back, included in the total amount returned to you in the mail. If no one buys the item, you'll lose your deposit.
You can also set a buyout price. This is the price at which you will instantly sell an item without having to wait for the auction to expire. Once you have set these options for your auction, press the "Create Auction" button. If the button is grayed out, then one or more of your auction settings is not correct. Recheck your settings and try again.