A license is simply the rules you expect others to abide by if they do anything (use it, modify it, post it, make fun of it, whatever) with your code.
a) You can put what you want, but to be taken seriously, you may use a license that is already nicely written and accepted ... check opensource dot org /licenses/category for a (loong) list
b) To decide which type of license, check out this recent aricle: http://www.itbusinessedge.com/cm/community/features/guestopinions/blog/ringing-in-the-new-year-with-clean-intellectual-property/?cs=38892&page=1 . Common ones are GPL V2, LGPL, Apache, New BSD- check out the summary matrix on Page 2 of the article
c) make sure your software doesn't include code from other open source or 3rd party, otherwise you'll be claiming theirs as yours- not a good idea! There are tools you can use on trial basis to scan your code.
d) put the text of the license in a License.txt or Copyright.txt file in the folder. Also add a simple (or complex, if you wish) header to the source files as Kimvais mentions in the previous post.
Good luck.
