The captcha module allows you to add functionality to prevent spam.  

When you download the module, it is actually two modules:  CAPTCHA and Image CAPTCHA.  Activate the CAPTCHA module by clicking the check box and click the save button at the bottom of the page.

Remember to click the save button at the bottom of the page.

With the module active, you can now configure your CAPTCHA module.  The configuration is located at Admin > Configuration > People or admin/config/people/captcha

On the CAPTCHA configuration page, you will see a large list of all the forms on your site, where CAPTCHA can be utilized.

This is all the forms that CAPTCHA can CAPTCHA.  Your list will probably look different.

If you wish to add a CAPTCHA to a form, select the drop down box challenge type and select what is available.  

What if your form is not listed?  Sometimes CAPTCHA does not find all your forms especially webforms.  You can manually enter in a form's name?  Check the quick hints to the right if you need help finding the name of your form.

Enter in your form name.  The above entry is wrong.  There should be underscores instead of dashes.

By default, out of the box Drupal CAPTCHA only has the math option.  Click the save configuration button at the bottom of the page.

Go visit the form/page and you will see your CAPTCHA!

Check out the next step in CAPTCHA, the advanced settings.