I'm in the process of doing this at the moment. You need a computer with either windows media center edition, windows media player 11 (you can download this) or the windows media connect download from the xbox or microsoft website. You then need to have a network that your xbox can link to, either a home LAN or internet connection (wireless or wired - it doesn't matter). If you have a wireless network you can buy the wireless network adapter for the xbox. If wired, use the ethernet cable that came with your xbox and plug it into your router or gateway. It should do it automatically from here.
There are instructions on the console if you go to settings then network connections and try a few of the media connect options.
There are instructions on the console if you go to settings then network connections and try a few of the media connect options.