Yes, you must be placed on the Institutional Request List, or an IRL, in order to receive an athletic scholarship and be eligible to compete at an NCAA Division I or 2 school. When you register for the NCAA Eligibility Center your eligibility is not reviewed until a coach asks the Eligibility Center to place you on the Institutional Request List.
If you are not receiving interest from Division 1 or 2 coaches then it is not necessary to register with the Eligibility Center immediately.
Once you have started receiving interest from Division 1 and 2 school you should begin the registration process. This includes answering questions about your academic and athletic history, and having your SAT or ACT scores and transcripts sent to the Eligibility Center.
Once you have completed the registration process you will be assigned an Eligibility Center number.
Your case will be reviewed and finalized once a coach uses your Eligibility Center number to request your information. Once a coach has requested you and your eligibility has been reviewed, you will either be cleared or deemed ineligible.