Well, personally I do:
1/ Think about how it'll look in my head.
2/ Sketch on paper whilst thinking about how the css will work - what will be fluid, how big will each div be etc
3/ Draw up in Photoshop.
4/ Go to bed
5/ Next day I check in Photoshop, if Im unsure Ill come up with a totally new deisgn or just a slightly revised one and draw that up. If Im sure its good then Ill go to 6/ 
6/ Create all the divs in CSS using notepad and created the index.html file in notepad. I just asign different background-colors to all the divs.
7/ Check this basic layout in IE 6, IE 5.5, Firefox, Opera and Netscape.
8/ Slice up my photoshop file and start applying images to the site.
Sometimes the ideas flow, sometimes not. It depends on how interesting the project is. If its a marketing site its boring and it'll take me quite some time to spice up the site. If its about something more interesting like music or photography then it takes me very little time to come up with a good design.
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