Drop the freeform_sms folder into your /system/expressionengine/third_party/ folder (or wherever you have your add-ons installed).
Navigate to your Extensions in the Control Panel and install it like any other extension.
Any Freeform form that exists will appear in the settings form and can be enabled by selecting the "Enabled" checkbox.
SMS Gateway Email - Enter the appropriate SMS gateway email for your provider. For example on AT&T this would look like [insert 10-digit number]@txt.att.net. Most major carriers support SMS emails so check with your provider for the appropriate format to use. Multiple emails are supported as a comma-separated list.
SMS Message - Enter the SMS message to send. Any tag in your Freeform form can be used in the message and will be parsed out. Keep in mind the character limitations of SMS.
Be sure and "Save" your changes.