YARP can be installed either by hand, or with the aid of robotpkg.
YARP has a number of requirements, and all of these packages must be installed following the instructions they provide, in the following order:
Instructions to create YARP-Python bindings are here.
Compiling the YARP Python binding will create two files: yarp.py and _yarp.so. To be able to use the yarp module within Python, you must copy said files to your Python lib directory (/usr/lib/python3.2/site-packages/) or at some place reachable from your PYTHONPATH environment variable.
The name of the installation directory may be different depending on your Linux distribution. If you use Ubuntu or similar distributions, replace the directory name of python3.2/site-packages for python3/dist-packages. Make sure to indicate the correct path used in your computer for all Python 3 libraries.
To properly use simulated cameras with yarp < 2.3.2, you need to apply the patch from patches/yarp.i.diff.
Probably that the easiest way to install YARP is to use robotpkg (see robotpkg homepage for more information). Follow the instructions on installing robotpkg. Then add the environment variable ROBOTPKG_BASE to your shell. Then to install YARP:
$ cd $ROBOTPKG_BASE/robotpkg/middleware/yarp $ make update
Afterwards, install the morse specific bindings for Python:
$ cd $ROBOTPKG_BASE/robotpkg/simulation/morse-yarp $ make update
This should take care of installing the required files yarp.py and _yarp.so to the correct location.