These are straight-forward step-by-step instructions based on Hugo Schotmann’s podcasting setup.

1. Open Audio Hijack Pro and create a new Session using the “+” button at the bottom left of the window. Name the session “Mic Input => SF2”.

Select “Audio Device” from the drop-down menu in the right pane.

For “Input Device” choose where you microphone is plugged into (on my Powerbook it’s “Built-in Audio: Line In). If you’re using the internal mic, choose that, if a iSight, choose that.
For “Output Device” choose “Soundflower (2ch)”.

2. Create a new Session using the “+” button at the bottom left of the window. Name the session “SF2 => SF16”.

Select “Audio Device” from the drop-down menu in the right pane.

For “Input Device” choose “Soundflower (2ch)”.

For the “Output Device” choose “Soundflower (16ch)”

3. Create a new Session using the “+” button at the bottom left of the window. Name the session “SF16 => Record”.

Select “Audio Device” from the drop-down menu in the right pane.

For “Input Device” choose “Soundflower (16ch)”.

For the “Output Device” choose “Built-in Audio: Headphones”

Choose the “Recording” tab at the bottom of the window. For “Format” choose MP3 (High). Set the location where you want to save your recordings, what to name them, etc.

4. Create a new Session using the “+” button at the bottom left of the window.

Select “Application” from the drop-down menu in the right pane. Then using the drop down menu on the far right, Select SKYPE from the list. If it’s not listed, choose “Select Application” and navigate to Skype.

WHEN YOU ARE READY TO RECORD YOUR PODCAST/SKYPE CALL

1. Open Skype and choose Skype > Preferences

Choose “Audio”. For the “Audio Output” choose “Soundflower (16ch)” For the “Audio Input” choose “Soundflower (2ch).”

Quit Skype.

2. Open System Preferences. Choose Sound. Select the Output tab and choose “Soundflower (2ch)” Under the “Input” tab it should be set to the input device you use to record (Line In, iSight, iMic, etc).

3. Open Audio Hijack Pro.

4. Select session “Mic Input => SF2” and press “Hijack”.
Select session “SF2 => SF16” and press “Hijack”
Select session “SF16 => Record” and press “Hijack”
Select the Skype session and press “Hijack”

5. Select session “SF16 => Record” and press the Record Button. That’s it!