^ What he said, but a little more detail. You can use most mods by enabling mods in the option menu and extracting them to My Documents\My Games\Elemental, a few mods have to be placed in Stardock Games\Elemental\Mods but those mods will normally have special instructions telling you this. Keep in mind that to load a mod, you have to enable mods and restart the application with a new game.
To tell if it's working you have to look for it's effects in game, normally the effects are pretty obvious, for the less obvious ones it can take awhile to see if it's working right. I use the cheat functions for mod testing, you can find instructions for the cheat functions on Gamefaqs.com
