Use Windows Server 2008 R2 Standard SP1 computer (a virtual machine as well) with most recent required updates.
Install application server role (full IIS support recommended).
Create two OS accounts for TFS services (recommended): TFS service itself and TFS build service.
Download TFS Express ISO image (<450MB)
and attach it to TFS server (as Image or as burned CD).
Start tfsexpress if not launched automatically.
Accept the license and install.
Confirm automatic restart of the server if required.
After server restarts, the setup continues.
Setup will try to download latest updates after succeeded finish (will fail if there’s no internet connection available).
TFS service configuration
After setup wizard closes, the next wizard starts automatically – the configuration wizard.
Confirm wizard start.
Change TFS Service account context (recommended) using TFS Service account created above – click “Change”.
Enter account name and password, check entered data clicking “Test”.
Change default port number (8080) if required.
Verify changes made or continue directly.
Start final configuration with “Configure”.
Configuration finalizing starts.
After configuration finishes continue with “Next”.
The final screen displays the URL to access TFS service (here http://tfsexpress:8080/tfs).
Click on the URL brings opens internet browser (here Internet Explorer, confirmation to unblock web address may appear).
Click “Add” to include the TFS service URL in the list of trusted URLs.
The Web frontend of TFS Service opens.
The wizard can be closed. Alternatively TFS build service may be configured from now.
TFS build service configuration
Continue the wizard with “Next”.
Change the project collection if not the default collection is to be used.
Configure number of build agents.
Change TFS build service account context (recommended) using TFS build service account created above, click “Test” to verify entered data.
Ensure test of entered account data succeeded, continue wizard.
Confirm the configuration settings or verify if required.
After validation of the settings start configuration with “Configure”.
After configuration finishes finish the setup with “Next”.
Review setup summary on the final screen.
After TFS build service configuration finishes check the summary on the final wizard screen and close the wizard.
TFS express administration console open immediately.
From now you can start to use your fresh TFS express instance and enjoy it!