Before we even begin, I should start out by telling you that even though growing your own avocado tree from a seed is lots of fun, chances are it won't produce lots of good-tasting fruit: if your main purpose is for your tree to yield lots of avocados, you're much better off grafting a plant bougth from your local greenhouse.
There are two main techniques for seed preparation: planting it directly in soil or hanging it into a glass full of water. I've tried both methods and the second is not only much more fun for the kids, but it tends to produce plants with healthier roots, so that's what we're going to learn!

After cutting your avocado and removing the flesh, you should pierce the seed, in the center, with three or four ordinary toothpicks forming an x-shape (see picture). Place it on top of the rim of a glass of water, with the toothpicks preventing the seed from falling (some people like to add charcoal to water). The pointy end of the seed should be oriented upwards.
After 2 to 4 weeks you should see the roots starting to form: when they reach a length of about 5-6 inches you should trim the top set of leaver, and leave the plant rest for another 2-3 weeks, allowing for more roots to form. Then, plant the seedling into a well-drained loose sandy loam, with the top of the seed barely peeking above the surface.
Soil should be kept fairly moist, without overwatering or you will cause the roots to rot, and an ideal temperature is around 60-70 °F.
The ideal moisture is just enough so that soil isn't completely dry, and it isn't drenched either.
When the seedling reaches 12 inches, it is generally advised to cut it back to around 8 inches: this will prevent the plant from becoming too high and lean, making it a bit shorted but much more round and sturdy.
It is very important that the soil is well drained, and pH should be around 6 to 7 (or slightly acidic).
The place you choose for the tree should be exposed to sunlight for at least 7 hours a day: while the plant will also grow in shady places, it will not be fully productive. Avocados contain lots of calories, and that energy has to be converted from abundant sunlight..so choose a very sunny.
If your tree is healthy, its roots will be very active, strong and aggressive, and will probably choke nearby plants, so try to choose a location with abundant free space (up to 20 feet). It's ok to plant several avocado plants in proximity, since this will help pollination and they generally don't choke each other.
The best soils for avocados have a clay content of between 20 and 40 %: if it is below 20 %, the soil has a limited water-retention capacity and unless optimum irrigation is applied, the trees will sometimes suffer temporarily from drought, while too high a clay percentage leads overirrigation and high rainfall to oversaturate the soil.
During the first year after planting, avocado trees should be fed a balanced houseplant fertilizer every two to three weeks in summer, and every five to six weeks in winter.
Bear in mind avocados need nutrients such as Nitrogen, Phosphorus and Potassium (NPK) in a 7, 4, and 2 part fertilizer respectively, and they need zinc as well!
After the first year, your tree should already be strong and healthy, and it's advised to feed it balanced fertilizer once every three months.
If your tree is already old (4-5 years), it will benefit from a nitrogenous fertilizer applied twice a year (once in late winter, and once in early summer).
Growing and Fruiting
When the plant is about a meter tall, freezing is the main problem if you live in cold climates: deep planting and soil mounding around the trunk are good assurances that the avocado will survive a freeze, even if the top is completely killed. If you have the luxury of forecasting a severe freeze , mound additional soil around the trunk for extra protection, then water thoroughly two or three days before the cold weather is expected. Young trees can be draped (not wrapped) with a blanket, quilt, tarp or even plastic during the freeze event.
Grafted avocados will produce a few fruit about two years after being "established" (which is defined as the tree having made significant growth after planting). Mature trees can produce some more bushels of fruit if you manage them well. Mexican-race seedlings and varieties usually mature during the summer; 'Lula' and most other hybrids mature in September or October. Storage on-tree is common and handy, and 'Lula' will store on-tree into January because of cooler temperatures. Fruits, however, don't ripen on the tree and must be harvested and held for several days. You can check for ripeness very easily:if the fruit is ripe, it will soften to good eating quality (it generally takes three to eight days).