If it doesn't activate over the internet (which it should). You telephone in for activation, you'll talk to an automated operator. You give her your hardware ID, then answer 3 questions. Is this the first time you're activating this copy of Windows (no), How many systems you have it installed on (one), and have you had any significant hardware changes (no). Sometimes it won't even ask you the questions. Then it'll give you your activation code.
Like I said, I do it everyday at work.
Here's a great FAQ about Windows OEM licensing. Which probably won't apply if you have a retail copy.
Microsoft OEM Licensing FAQ - [H]ard|Forum