How to adjust the rear derailleur on a road bike?

Have you just fitted your rear derailleur, or are your gears shifting inconsistently? It is time to adjust your derailleur.

Position the derailleur on the smallest sprocket, then release the derailleur cable
Adjust the low limit screw (H screw - High Speed) so that the derailleur jockey wheel is perfectly aligned with the outer face of the smallest sprocket.
Operate the derailleur by hand to move it and align it with the largest sprocket in order to adjust the high limit screw (L screw - Low Speed) of the derailleur so that it cannot go further than that sprocket.
Release the derailleur, then screw the cable tension barrel adjuster fully in before unscrewing it by 2 turns.
Refit the derailleur cable, pulling it lightly taut with the flat-nose pliers.
Place the drivetrain on the smallest chainring and the largest sprocket.
Adjust the B-tension screw so that the distance between the sprocket and the derailleur jockey wheel matches the manufacturer's recommendation (generally 5/6 mm).
Complete the adjustment using the cable tension barrel adjuster until you achieve the smoothest possible gear shifting. If the gear won't shift up, there is not enough tension; if it won't shift down, there is too much tension.
Probikeshop tip: To make the final adjustment easier, lubricate your drivetrain.