You can add navigation by various ways:

1. When you add Content
If you add content you get a page with several options. One of these options is Menu setting. When you select this option you see the following fields:

You can add a Title (this name will be visible as navigation item), a description and via the Parent item: pulldown you can select the spot where this page should be visible in the navigation.

Be aware of the fact that the administrator tools are also in the menu, so don't select one of the administrator tools because visitors then won't see the page in the navigation. So you need to select or Navigation or Primary Links (at the end of the list in the pulldown) to add your page als navigation link. If you select Primary Links the page will be displayed at the top of your site. Do you select Navigation then it will be visible at the left hand navigation. Ofcourse this is depending on how you've configurated your website.

Subnavigation
If you want to create subnavigation via this way, you first need to add the main page so f.e. the mainpage is "Cars". After you have added the page cars and connected to the Navigation via the Menu settings you can add a subpage (f.e. Audi) exactly the same way but instead of selecting Navigation in the menu settings you scrowl down and select the Cars page.

2. Use keywords / Taxonomy for the navigation.
This is a bit complexer, but a great way to build your site! If you want to create navigation via keywords you first need to fill the site with content including keywords before you can create a navigation. Before adding content you need to activate the taxonomy module --> http://freedrupal5hosting.com/forums/taxonomy-keywords

As soon as you have the feeling that there is enough content and enough keywords in the site you can start to create the navigation. At www.play42.com I have added all kinds of multiplayer games with keywords such as action / fantasy / strategy / first-person etc.
If you click on the keyword (action f.e.) which is connected to a certain page you will see this in the URL: http://www.play42.com/taxonomy/term/6
You need to remember this path /taxonomy/term/6

Now go to Administer and select the option Menus
At this page you see the Primary Links and Navigation again and also the option to add an item:

Decide if you want to add a primary link or a navigation link and click on add item. At this page you can enter the title (action in my case), a description and the path (/taxonomy/term/6 in my case). At this page you also see the Parent items pulldown again but if you already selected primary links or navigation this will be filled in automatically.

Submit your page and all items which you connected to this certain keyword (action in my case) are collected below this navigation item. And this is the great thing of creating a navigation with keywords.