The armor stand is a block crafted with two sticks and three stone. Right click the Armor stand put your armor on the stand.
Once the armor stand is placed, right clicking on the base will bring up a 2x2 grid plus extra square on the side. There are also a number of options on how to display the stand. If nothing is chosen the armor will appear to be floating, Black will use a silhouette player skin,Zombie shows a zombie skin, Player shows your current skin, and Char shows the default "Steve" skin. The Stalker option will make the head move so that it always faces the player, even beyond the normal body movements.
The 2x2 grid is where armor is place starting from left to right, top to bottom. Helmet, Chest piece, Leggings, boots. The extra square is for the stand base and accepts almost every block.