Pick a location the air conditioner unit (A/C) will be installed. Try not to locate above electrics and electronics because they may be damaged by condensation from the discharge air grates on very humid days.
Plan to keep the bottom of the unit between 12" and 60" from the floor to minimize dust from the floor clogging the filter, and condensation forming on the ceiling.
Locate studs by either using a stud finder or visually inspecting baseboards for nail heads. Lightly indicate with pencil on the wall where these studs lie.
Roughly indicate the layout of the A/C (or "unit") on the wall, in such a way that the number of studs to be removed is minimized.
Cut the bottom straight piece from a coat hanger, and chuck it in the drill. Clip the cutting edge of the coat hanger "blade" at a 45 degree angle. Run the drill at a higher speed, FULLY into one of the bottom two corners of the A/C location. Lightly guide the "blade" with your hand to keep it straight as you slowly and evenly apply pressure on the drill. With the "blade" fully into the wall, unchuck it from the drill and remove the drill. With the "blade" still in the wall, go outside and locate it. Make sure that it indicates no problems with the intended location of the A/C. Cut or pull the "blade" out. The coat hanger "blade" trick is also great for locating where to drill in basement ceilings so that that the hole lands in a wall space - not through a rug, hardwood floors, etc. Simply drill at a seam between boards or even in carpet downward to the basement - unlike a drill bit, there's no sharp edge on the side to snag carpet nap. When in the basement, using the coat hanger as a reference point, drill UP a couple inches over (or however much you need) from the coat hanger with the bit size you need.
Remove any molding above and below the intended opening location.
Remove the wallboard between those studs indicated from the floor to the ceiling first by scoring the wall with a razor blade (utility knife) along the inside of the studs. With a hammer or gloved fist, knock out just enough wallboard to locate any wires or other obstructions that could be damaged with a saw. Saw (use of hand saws made for wallboard will minimize dust) by cutting as close as possible to the side of the studs. If using a Sawzall or similar, a helper with a vacuum set up OUTSIDE and the hose run indoors to allow following along with the cutting operation will reduce dust considerably. Use of a utility knife works surprisingly well on wallboard, and will result in the least amount of dust and risk of damaging wires and pipes in the wall space. To use the knife, repeatedly score the wall top to bottom. You do not need to completely penetrate through the wallboard - but just get through half to 3/4 of the thickness. Bang on the wall with a gloved fist and arms to break the wallboard along the scored line.
Remove the insulation.
Remove the center stud(s) if needed to accommodate the A/C.
Transfer the dimensions of the A/C or sleeve to the inside of the outside wall. Laying out the opening so that the top will fall just under the edge of a full clapboard, shingle, siding, etc may look better than it being in the middle of it. Use the coat hanger to drill from the outside just under the siding lap. Imagine what would look best for the application. Make sure the opening will be level and square. Check for square by selecting one of the 4 corners. From the corner, measure along one line and mark at 3 inches exactly. Measure and mark at 4 inches exactly from the same corner along the other line. Measure between the mark at 3 inches and the mark at 4 inches. The result should be 5 inches EXACTLY. If the measurement is not exactly 5 inches, the opening is not square (this is the "3 4 5 triangle" that will only measure correct when there is a perfect 90 degree angle). Repeat at the OPPOSITE corner (this does not have to be done on all 4 corners - just 2 opposite corners). Of course, use of a framing square will quickly determine if the opening is square or not.
Add 1/4 inch to the HEIGHT of the opening. This additional 1/4 inch will allow the unit to be "tipped" downward on the outside to prevent condensate and rain water from collecting in the unit and leaking inside the house. If you have a specific point for the top of the opening, add this 1/4 inch to the bottom for the new line to cut.
Carefully create the opening by cutting along the lines that represent the A/C dimensions on the wall with a Sawzall.
Cut a stud to fit against the two studs that make the sides of the opening created for the A/C (or "unit"). Level and install at the bottom edge of the A/C unit location. Cut a stud to fit between the "2 by" (2 x 4 or 2 x 6 which ever your construction is) on the floor in the wall space and the bottom A/C support installed in the previous step - install one on each side.
Screw or nail these studs to the existing studs. There should be three (possibly four if the unit is very large) new vertical studs in the space below the unit; all of which run from the bottom to the underside of the horizontal support; one in the middle, one against the existing left stud and one against the existing right stud.
Cut two (2 x 4 construction) or three (2 x 6 construction) pieces of the same length from a 2 by. Cut one or two (again, 1 for 2x4 or 2 for 2x6 construction) strips of 1/2" plywood the same size as the 2 bys.
Fabricate a header by aligning and sandwiching the plywood strips between the 2 bys and nail or screw together. The completed header thickness should be very close to 3-1/2 or 5-1/2 inches (for 2x4 or 2x6 construction, respectively). The header will be the top of the framework for the opening.
Cut two 2 bys equal to the opening height. Secure them against the existing studs in the space for the unit, by resting on the bottom horizontal support previously installed and nail or screw in place.
Rest the header on top of the vertical supports installed in the previous step. Secure the header by nailing or screwing in place.
Cut a 2 by to fit between the header and the top plate (the 2 by that the left and right most studs are secured to at the very top) plus 1/8 inch at the left-most stud and nail or screw into place. Hammer these studs into position. Repeat for the right-most stud. Repeat for at least as many vertical studs installed in previous steps below the unit, in the space above the new header. If one stud was cut and installed in the middle of the wall space for the bottom support of the unit, then at least one (but more would be better) will be required above the opening as well. These studs above the header should fit tightly as any spaces will be reduced to zero as the weight settles on the new framework in the wall. If not a tight fit, cracks may develope on the wall surface.
Cut two 2 bys equal to the height of the opening. Making this cut a "little long" (1/16" or so) will help ensure settling will not reduce the opening and minimize any movement. Hammer these 2 bys along the left and right side of the opening. Nail or screw in place.
Install any outlet required while the wall is open. If the unit is high on the wall, consider installing an appropriately rated switch at this time for the outlet, as this will make powering the unit on and off easier. It will also reduce the chance of damage during electrical storms if set to off.
Reinstall the insulation.
Install the wallboard.
Tape, mud (joint compound) and sand when dry.
Paint wall and reinstall all molding.
Remove unit front cover and screws that hold the unit inside its case. Pull the unit forward while an assistant holds the case, until it is fully withdrawn.
Install the case or sleeve into the opening. Allow several inches of the case or sleeve to protrude from the wall into the room. Measure the amount of protrusion at one of the top corners, and start a screw through the sleeve or case close to this corner into the framework to keep it from moving. Move the case or sleeve in or out so that the other top corner has the same amount of protrusion. Start a screw through the sleeve or case close to this corner into the framework to keep it from moving. Repeat this procedure for the bottom corners, but remember to have the protrusion here 1/4 to 1/2 inch greater than measured at the top. This creates a position for the case or sleeve that is tipped downward to the outside and will minimize the chance for condensate and rain water from collecting and leaking inside. Once the case or sleeve has been "tacked" in position required, firmly secure it by driving the screws fully. Secure it with at least two screws for each of the four sides.
Caulk around the unit by running a generous bead between the unit and the inside framework.
Caulk around the unit by running a generous bead between the unit and the outside clapboards, shingles, etc. Extra time spent here will ensure a seal that will help keep water out. Do not scrimp here. Use a high quality "30 Year" (or more) caulk rated for use outdoors. Make sure it is paintable if you intend to paint over the caulk.
Install molding around the unit inside by cutting appropriate length boards at a 45 degree angle (you did make the opening exactly square, right?). Secure with finish nails. Set and fill nail heads and paint.
An "air conditioner sleeve" is required for windows type units that do not allow for the removal of the air conditioner from its case. Without the sleeve, there is no way to secure the unit into the opening. When using a sleeve, references to cutting an opening to match the dimensions of A/C, unit, etc. should be interpreted to the "sleeve" instead of the unit case.
Sleeves are also nice to have so that if the unit should ever need to be replaced, finding one the exact same dimensions won't be required. Simply pull out the old and slip in the new.
Sleeves will need additional time and material to custom fit the unit into the sleeve. That part is up to you complete for your particular application. It should at the very least include insulation and trim boards. After stuffing insulation around the top and side(s) of the unit, secure trim boards with screws through holes drilled into the part of the sleeve that extends into the room. Be sure not to cover vents (if any) on the sides of the unit.
Things You'll Need
"2 bys" (2x4 or 2x6) to match the construction of your home.
philips bit and magnetic holder
metal coat hanger
Sawzall ( reciprocating saw)
utility knife and blades
2-1/2" nails or screws
molding for inside trimming of the opening
insulation / low expanding foam insulation for sealing cracks / voids
miter box for cutting 45 degree angle molding