There are two ways to install mods in phpBB. The first way to install a phpBB mod is to open the install file and read the instructions. Opening the file in an internet browser is good because it will make the file more readable (they’re in some sort of xml format).
The install file will then tell you how to install the mod, which includes which files to copy, where to copy the files to, any SQL commands to run and any web based tasks to perform before, during and after the install of the mod.
A better and easier way to install phpBB mods is to use a mod to install them. One such mod is called AutoMOD. After installing AutoMOD, you will then be able to install mods from the Admin Control Panel.