I get this question a lot, usually from friends who are happy to do most of the necessary work, but don't know where to begin. I have a site that focuses on this kind of thing - The Guide to Blogging. It's focused on blogging, but will be useful for any type of website.

A quick overview

In brief, here's what you need to think about:

1. What is the site going to be called? Do you already have the domain name? Finding a suitable domain name can be quite time consuming, but with a little creativity, you can find some absolutely incredible domains. (I have a few that I might share once the sites have something on them.)
2. How should your site be organised? You need to have a very clear idea of this before you begin. Most sites will have a home page, an about page, and a contact form or just a link. You need to have some idea of what information you'd like to put on each page. You will need to write this information yourself.
3. How much content do you plan to have on your site? Structure is important, but many sites will want more than a few navigation links with a page of text behind each one. If you want interactivity built into your site, such as a blog, opinion polls or a custom survey, this should be mentioned at the very start.
   
4. What are your thoughts on design? e.g. logo, colour scheme, layout. Do you have any images that can be used? This is one of the toughest areas to work on, because it is very subjective. Some people have no idea what they want, but will reject every design they see. Others will have a very specific idea that they've put together in Word, Publisher or PowerPoint, but it may not be practical to build as a website. This is one area where it helps to have a few ideas, but you should be open to suggestions. If you have absolutely no idea how your site could or should look, try looking at some of the website templates at Template Monster. At this stage, you're only looking to get an idea of what can be done. Don't actually buy anything yet!
   
5. What's your budget? In many cases, I think that money needs to be discussed early on. For larger projects, a written agreement signed by both parties may be necessary. Don't feel that you have to state your maximum budget up front - but do get a quote before you agree to anything.

A comprehensive guide

If you have a bit of time to do some background reading, The Guide to Blogging provides plenty of information for your perusal.

First, I suggest you read the following: Blogging Quick Start Guide. This covers things like your domain name, web hosting, and how to link the two together.

Next, the following guides should give you an idea of what else needs to be considered before you dive in:

1. Why do you want to set up a site?
2. Are you creating a blog or a website?
3. What should you look for when selecting website software?
4. Should you go with hosted or self-hosted?

I can also recommend reading some web design tips, along with content writing tips. I'll be publishing more tips in the future.

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