How is collimation done in a telescope ?

Collimation refers to the process of adjusting the different components of the optical system such as  lens, prism and the mirrors.  A telescope which is not collimated will result in blurry images. 

Different types of telescopes have different methods of collimation.

How to collimate a telescope ?
http://www.viewfromascope.com/how-to-collimate-a-telescope/

A beginner’s guide to collimation
http://www.garyseronik.com/?q=node/169

Collimation of a Newtonian Telescope
http://www.skyandtelescope.com/astronomy-resources/how-to-align-your-newtonian-reflector-telescope/