I can see that at least a few visitors to the "phytools" blog have reached this page through the google search "installing phytools" - so I thought I'd say a couple of words about how this can be done at present.
1) Download the package from my R phylogenetics page. If you are a Windows user, you can download the Windows binary (this file ends in ".zip"). If you are a Mac or Linux/Unix user, download the package source (this file ends in ".tar.gz" - actually, you should also be able to install from source in Windows if you are so inclined).
2) Either navigate to the directory containing the "phytools" package installation file, or move the file to your current directory. For the former, you can either use the Windows GUI File->Change dir...; or the R command setwd(). For the latter, the R command getwd() (which returns your current working directory) should be helpful.
3) Now simply enter either:
(for Windows installation, assuming the latest version of "phytools"), or:
for installation from source.
4) Finally, to load the "phytools" library, one simply types (as with any other contributed package):
and you're ready to go!
**Note that I am getting ready to submit "phytools" to CRAN which will have the effect of collapsing steps 1-3 into a single command.**