Note: XAMPP 1.7.2 and later includes PHP 5.3. Drupal versions earlier than 6.16 will not operate correctly on PHP 5.3, so you will have to use an earlier version of XAMPP if you need to use a Drupal version earlier than 6.16.
Install & Setup XAMPP
It works better when you install directly to C:\, rather than the Program Files directory.
For XAMPP to function properly, make sure you have Skype turned off, or alternatively in Skype go to Tools > Options > Advanced > Connections > Uncheck "Use port 80 and 443 as alternatives for incoming connections".
2. Start Apache (Web server) and MySQL (database server) services from the XAMPP control panel.
3. (Optional, for added security) Decide on a password for the MySQL root user that you will remember.
Browse to http://localhost/security/xamppsecurity.php and enter the MySQL username and password you have chosen. Stop and restart MySQL in the XAMPP control panel (takes ten seconds).
Download & Install Drupal
1. Download the latest recommended version of Drupal. Save the download in C:\xampp\htdocs.
2. When you unzip the download of Drupal, it will probably create a directory called "drupal-6.17" (or whatever the latest version of Drupal is). Possibly rename this directory to "drupal", so you can access your local Drupal install at http://localhost/drupal.
3. In a web browser, go to http://localhost/phpmyadmin. If you set a password, log in with "root" and the password you chose.
Click on the Privileges tab to create a new database user for Drupal. Choose the name "drupal", select "localhost" for host, and enter your password (twice). Choose the option to create a new database with the same name and grant all privileges (check all).
4. Copy & paste the file "default.settings.php" in "c:\xampp\htdocs\drupal\sites\default", under the drupal directory, and name it "settings.php".
You should now have two identical files in your "c:\xampp\htdocs\drupal\sites\default" folder -- one called "settings.php" and one called "default.settings.php".