quest:optimization with indexes

hello,
im looking for info/help on creating indexes
im using 6.5
we have a table overe 100,000 rows

if we put in an index or not an explain say it still does a seq scan,
same amount of time taken!

ive tried putting the index using just the oid , a combo of some fields
of our data using btree

where/what rules should be followed for setting up a good indexing
scheme under pg?