First of all, choose the blog that you want to put AdSense on, and go to the Template Page Elements tab. You can get there by clicking the "Layout" link on the dashboard, or clicking the "Template" tab from the posting or settings page of the blog.
Once you're there, click on one of the "Add a Page Element" links. Choose the one that corresponds to the area of the page that you want to contain your AdSense ads. The "Choose a New Page Element" window comes up, from which you can select the AdSense option.
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