Reading Hands

When readings hands you try to deduct the cards your opponent could have to a range of possibilities. It's not about putting a player on a exact hand, but sometimes you will.

You will only learn to read hands accurately through experience, good memorizing and many hours of play.
I should note that reading hands is not very useful for the lower limits since players at these levels are generally very unpredictable. But even at the lower limits you can get a pretty narrow range on your opponents cards. Unexperienced players tend to play very straightforward - betting big on their big hands and small on their weak hands.

Keeping an eye on these factors will help you to narrow down the range of hands your opponent could have:

1.   Starting hands your opponent plays
2.   Betting paterns
3.   Showdowns of other players
4.   Replaying your own hands
5.   Taking notes
6.   Understanding opponents actions

If you are moving up in stakes you will notice that other players are trying to read your play too. This will take poker to the next level. Your thought process should not only depend on what you think they have, but also what they think you have.
If you aren't thinking on the right level you'll be getting the worst of it.

However, knowing the range of cards your opponent could have and what he might think you have is not the key factor of reading hands.
It's knowing how to adjust your strategy to that knowledge and making the right play.