There is no formal installation method. If you have downloaded the source-distribution and are using Linux, you should run
$ > make src jar
This will generate and compile all source-files and generate the im4java library (the jar file im4java-version.jar). Note that compiling the library requires bash and make and the java development kit. If you use a different operating system, you must either install a unix-environment (e.g. cygwin for Windows), or you should download the binary distribution of im4java.
After you created the im4java library (which is also part of the binary distribution), you just add it to the CLASSPATH of your project.
If you want to recreate the documentation from source, you need Apache Forrest, version 0.8, and run
$ > make doc
Support for JRE 1.5
In case you need a version compatible with JRE 1.5, you can create a 1.5-compatible version from source with
$ > make src jar-1.5
The binary distribution already has a 1.5-compatible version named im4java-version-1.5.jar.