The "update status" module checks with drupal.org once a day to see if there 
are new versions of Drupal and any modules that you are running. It requires 
cron to do its thing, so make sure that you have cron correctly enabled or
it won't be able to know. 

You can always manually hit cron from the administer >> logs >> status report 
page.

This module can only check for modules that are installed from 
'official releases' via the tarball. It will try to guess at modules 
installed from 'development snapshots' and from CVS, but if drupal.org
does not contain any official releases, nothing will show up. However,
once an official release appears on drupal.org, update status will see
that. While it will not mark the module out of date if it is from CVS,
it will mark it out of date if it is from a -dev snapshot.

You can tell it not to create a warning about a project being out of date
from the update_status settings page. For each project that it identifies
as having an official release on drupal.org, you may tell it to warn
if a project is has a new version available 'always', 'not for the current
version', or 'never'. If you select 'not for the current version' and
a new version is posted, the project will then show as having an available
update.

Modules that are set to not warn if updates are available, or are identified
as being CVS checkouts are displayed in yellow.

You can tell what type you are using by visiting administer >> site building 
>> modules. If the version number is in the form of "5.x-1.0" (for example) that is
an official release. If the version number is in the form of "5.x-1.x-dev"
then you are running a dev version. If it looks like "$Name: DRUPAL-5--2-0-BETA $" or is
blank, you are probably running a strange version or a version from CVS.

INSTALLING THIS MODULE
======================

Simply drop the entire directory into your 'modules' directory or your 
'sites/all/modules' directory. Then visit administer >> site building >> modules
and enable this module.

USING THIS MODULE
=================

After installing, you may visit administer >> logs >> update status. If cron
has not yet run (and it probably won't have right after installing) run cron manually
to get the system started. 

The module will check on the next cron run that is at least 24 hours since the
last time your module update status was checked.