Might be easiest to visit this page on the Silverlight.net site. But a simple summary is below:

What you'll need to run a .NET Silverlight app

• Silverlight 1.1 Alpha

What you'll need to build a .NET Silverlight app

• Silverlight 1.1 Alpha SDK
• Visual Studio codename Orcas Beta 1
• Microsoft Silverlight Tools Alpha for Visual Studio codename "Orcas" Beta 1
• Expression Blend 2 May CTP

What your .NET Silverlight application consists of

• An HTML "host" page
• JavaScript files to create / load the Silverlight control (CreateSilverlight.js & Silverlight.js)
• A root XAML file & associated assembly (these constitute your app)
• Optionally
• Other app library assemblies (maybe your own, maybe Microsoft etc)
• App resources (eg XAML resources)