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You can create an eBook quickly and simply with a program called Sigil. Your eBook will be in the widely used EPUB format.

Amazon is able to convert your EPUB document to its Kindle format, however its table of contents may not convert. To preserve your table of contents, first convert your EPUB file to MOBI format with a program called Calibre. Both Sigil and Calibre are free downloads. If you find them useful, their authors will appreciate your donation.

1. Download and install the eBook editor, Sigil http://code.google.com/p/sigil/.

2. If your book doesn’t contain illustrations, each chapter can be a separate Word file. If your eBook contains illustrations, break your chapters into sections so that you can place illustrations at the end of each section.

3. Keep your illustrations' file size small, if possible. If you intend to publish for Kindle, be aware that current models (except the Fire) display only a few shades of gray. If your color pallet contains 256 colors or fewer, GIF illustrations work well to keep your file sizes small. However, for photographs you should use JPEGs. To fit the Kindle screen, make your images 500 pixels wide by 600 pixels tall. Your cover should be a JPEG 600 pixels by 800 pixels. To ensure compatibility with future Kindle models, use color graphics at 300 pixels per inch.

4. Using Word, set up your book chapters so that the chapter text is Normal style and the chapter titles are Heading 1 style. You can use Sigil’s TOC Editor (on the Tools menu) to create a logical table of contents from your formatted chapter titles. If you plan to publish on Kindle, you should also include a navigational table of contents and an inside cover page. Elizabeth Castro explains how to build these pages in her excellent book on EPUB formatting. Along with its TOC Editor, Sigil provides a Meta Editor for adding title and author information.  

5 Save all your book chapters in Word as “Web Page Filtered” files.

6. Launch Sigil and use a right mouse click to select the Text item Section0001.xhtml. Choose “Add Existing Items …” and add your “Web Page Filtered” files. Tip: By holding down your Shift key while selecting your files, you can add all the files at once.

image of Sigil menu

7. Once the files have been added, delete the original Section0001.xhtml file. Drag the files into ascending order beginning from the top of the Sigil Text window.

8. As you click files in the Text window, they will appear as tabbed previews across the top of the Sigil interface. Use the Insert menu to add pictures to your eBook.

9. If your intent is to publish for Kindle, you can add a cover after uploading your eBook on Amazon. Your cover should be full color. It should be a high quality JPEG (or Tiff) 600 pixels wide by 800 pixels long, formatted to 300 pixels per inch.

10. You've now finished a basic eBook which will display well on most eBook readers. Sigil does a generally good job of converting Word HTML into XHTML, however it is not designed to take advantage of features that will be available when HTLML5 is released. Amazon addresses some of those features in the Kindle formatting guidelines it released in January 2012.