Backing up is very important. You will make mistakes and will need to restore files.
Some minor changes in Firefox's configuration, such as disabling the XUL cache and telling Firefox to load a theme that is not yet packaged in a jar, will make theme development much easier.
Determine what the theme should look like. Metal, wood, and animals are all possible theme topics. Check the Mozilla web pages to see whether there is already a theme similar to yours; if there is, find a different topic.
Create your background images to match your ideas on how the theme should look. Images can come from virtually anywhere, such as nature, people, or surfaces. Surfaces are the most common.
Leave the details, such as button images, until you have all the other visual aspects of the theme completed.
Firefox's default theme, classic, can serve as a starting point for your theme, but you will have to provide a contents.rdf and an install.rdf file. You can download examples of both files from this book's website.
Eventually your theme will need an icon and a preview image. Both can wait until you are done with your theme. Most preview images are a section of a screenshot of the theme.
JAR files can be hard to work with. WinZip, TUGZip, and Windows Explorer can help make JARs easier.