Connection methods
To setup a network, you have to have all the devices connected in a certain manner.
Cable Modem, DSL Modem or Dial up Modem has to be connected to the router. The router has to be connected to all the computers. You can have the modem connected to a computer instead of the router but if you do that, you will have to leave that computer turned on at all times for the other systems to access the internet. It is best to connect the modem to the router. There will be a port labeled for the modem. You plug the modem into that port.
You do not have to have a modem for a network. You only need the modem if you want access to the internet.
If you are connecting only two computers, you do not have to have a router. You can use a crossover cable. If you are connecting more than two computers or want wireless, you will need a router.
For Wired Network
Connect the network cables from each computer to the ports in the back of the router.
For Wireless network
You will have to setup the wireless. You won't need cables for the use of wireless, but you will need a cable for the initial setup of wireless. Once wireless is setup, you won't need the cable.