Every item has a starting price. In most auctions this is $1. To bid on an item click on the Place Bid button on the item. You will be shown a window which displays the current bid and the minimum amount you can bid on the item.
The minimum bid is the current bid plus a bid increment. The bid increment starts at $1 when the last bid is $20 or less. For higher last bids, see below for complete list of bid increments.