For now this is a raw copy from the old Documentation/kbuild/modules.txt,
which was removed in 2.6.0-test5.
The information herein is correct but not complete.

Installing modules in a non-standard location
---------------------------------------------
When the modules needs to be installed under another directory
the INSTALL_MOD_PATH can be used to prefix "/lib/modules" as seen
in the following example:

make INSTALL_MOD_PATH=/frodo modules_install

This will install the modules in the directory /frodo/lib/modules.
/frodo can be a NFS mounted filesystem on another machine, allowing
out-of-the-box support for installation on remote machines.


Compiling modules outside the official kernel
---------------------------------------------

Often modules are developed outside the official kernel.  To keep up
with changes in the build system the most portable way to compile a
module outside the kernel is to use the kernel build system,
kbuild. Use the following command-line:

make -C path/to/kernel/src M=$PWD modules

This requires that a makefile exits made in accordance to
Documentation/kbuild/makefiles.txt. Read that file for more details on
the build system.

The following is a short summary of how to write your Makefile to get
you up and running fast. Assuming your module will be called
yourmodule.ko, your code should be in yourmodule.c and your Makefile
should include

obj-m := yourmodule.o

If the code for your module is in multiple files that need to be
linked, you need to tell the build system which files to compile. In
the case of multiple files, none of these files can be named
yourmodule.c because doing so would cause a problem with the linking
step. Assuming your code exists in file1.c, file2.c, and file3.c and
you want to build yourmodule.ko from them, your Makefile should
include

obj-m := yourmodule.o
yourmodule-objs := file1.o file2.o file3.o

Now for a final example to put it all together. Assuming the
KERNEL_SOURCE environment variable is set to the directory where you
compiled the kernel, a simple Makefile that builds yourmodule.ko as
described above would look like

# Tells the build system to build yourmodule.ko.
obj-m := yourmodule.o

# Tells the build system to build these object files and link them as
# yourmodule.o, before building yourmodule.ko. This line can be left
# out if all the code for your module is in one file, yourmodule.c. If
# you are using multiple files, none of these files can be named
# yourmodule.c.
yourmodule-objs := file1.o file2.o file3.o

# Invokes the kernel build system to come back to the current
# directory and build yourmodule.ko.
default:
	make -C ${KERNEL_SOURCE} M=`pwd` modules