I highly recommend keeping the command list in front of you at all times, at least until you are familiar with the game. I tried playing the game without this list, and found it be very difficult especially when at sea. When on the land, you use the arrow keys or mouse to walk, and space to talk or interact. If you are facing someone and a beige box pops up in the corner of your screen for example, you can talk to an individual. This is the same method used for opening a door.
Land consists mainly of towns or ports.
You can talk, align yourself to a country, buy and sell goods, hire new crew members, upgrade your ship, and even pick up a lady if you are so inclined. Talking is simple. After pressing the interact key, you will see a brief message from the individual. After the message, a list of options will be at the bottom. Using the up or down arrow, you select what you want to say.