1) Create a directory on your server ( e.g. cutenews )
2) Upload the content of the cutenews.1.3.6.zip to the directory you created in step 1
3) Now You must CHMOD the the directory cutenews/data/ and all files and
folders under the data/ directory must be also chmod'ed to 777.
4) Finally, go to http://yoursite.com/cutenews/index.php with you favorite browser and fallow the instructions.

thats what it says ... i did steps 1 and 2 but what the heck is chmod!!

Chmod defines who can access and write files. You should be able to edit the number or tick all options when right-clicking files, depends on program though.