If you ever feel the need to capture a moment from your Android phone for posterity, you’ll want to be able to grab screenshots from it.  Here is the method used for taking screenies on your Android smartphone-

• If you’ve not done so already, install the Android SDK.  Make a note of the install location (for detailed instructions on installing the SDK, check out this link, it’s not as daunting as it first appears, honest!)
• On your phone push the menu button (or tap the Settings widget if you have one)
• Tap Applications
• Tap Development
• Ensure that USB debugging is checked
• Connect your phone to your PC via USB
• From the Android SDK installation location you took note of in step 1, open the Tools folder
• Double click ddms.bat
• Highlight your phone from the list on the left hand side (it won’t be called ‘HTC Hero’ or ‘G1′ for example, my one reads: HT98BL900608)
• From the menu at the top, click Device and then Screen Capture and, hey presto, a screenie from your phone!  You can now save the image if you’re happy with it, or, browse to the screen you want from your phone and hit refresh to refresh the screenie.

Edit- As pointed out in the comments (thanks for the input), it’s worth mentioning that there is an app on the market called PicMe that will allow you to capture screenshots too, but it only works on rooted phones.  The guide above will work for both rooted and unrooted phones.