WHAT MENORAH TO LIGHT
To publicize which night of Chanukah it is, the menorah must easily display how many candles have been lit. Therefore, all 8 candle-holders on the menorah should be at the same height - and preferably in a straight line. Otherwise, the candles may not be easily distinguishable and may appear as more like "one big torch."
In addition to the main 8 lights, each Menorah has an extra helper candle called the "Shamash." Since we are forbidden to use the Chanukah lights for any purpose other than "viewing," in this way any benefit is as if it is coming from the Shamash.
Since the Shamash does not count as one of the regular 8 lights, your Menorah should have the Shamash set apart in some way - either placed higher than the other candles, or significantly off to the side.
WHAT CANDLES TO LIGHT
The most important thing is that that your candles must burn for at least 30 minutes after nightfall. (Those famous colored candles just barely qualify!) Many Jewish bookstores sell longer colored candles.
Actually, it is even better to use olive oil - since the miracle of the Maccabees occurred with olive oil. Many Jewish bookstores even sell kits of pre-measured oil portions in disposable cups. These cups can simply be placed in the candle holders of any standard menorah.
WHERE TO LIGHT
To best publicize the miracle, the Menorah is ideally lit outside the doorway of your house, on the left side when entering. If this is not practical, then the Menorah should be lit in a window facing the public thoroughfare.
Someone who lives on an upper floor should light in a window. If for some reason the Menorah cannot be lit by the window, it may be lit inside the house on a table; this at least fulfills the mitzvah of "publicizing the miracle" for the members of the household.
Since the mitzvah occurs at the actual moment of lighting, the Menorah must be lit in a proper place. Moving the Menorah to a proper place after lighting does not fulfill the mitzvah.
WHEN TO LIGHT
The Menorah should preferably be lit immediately at nightfall. It is best to wait, however, until all the members of the household are present. This adds to the family atmosphere and also maximizes the mitzvah of "publicizing the miracle." However, the Menorah can be lit (with the blessings) late into the night, as long as people are still awake.
The Menorah should remain lit for at least 30 minutes after nightfall, during which time no use should be made of its light.
On Friday afternoon, the Menorah should be lit 18 minutes before sundown. And since the Menorah needs to burn for 30 minutes into the night, the candles used on Friday need to be bigger than the regular "coloured candles" (which typically don't burn longer than a half-hour).
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