1)If you don’t have the Paypal module installed then you will need to install it. The instructions can be found here:http://addons.prestashop.com/en/content/21-how-to

2) Then we want to setup a Paypal test (sandbox) account. The instructions to this process can be found here: http://www.hostknox.com/tutorials/miscellaneous/paypal-sandbox

-This link above will tell you how to setup as seller (merchant) account and a buyers account.
-Remember the password for these test accounts. When you start testing buy and sell transaction with your e-shop, you can actually login to these accounts and review its history of transactions.

3)Now go back to your PrestaShop Paypal module via the admin tool and configure the Paypal settings. The instructions for this process can be found here: http://www.hostknox.com/tutorials/prestashop/payment-methods/paypal

4) Test away!