To get Search Engine Friendly URLs to work in Joomla, you need to do the following:
1 FTP to the root directory of your website and rename the file .htaccess.txt to simply .htaccess
2 In the Joomla Global Configuration Page, turn all three SEF options on the RH-side to ON
Now each article you generate is capable of being 'ranked' by Google as a discrete web page. However, do read the following tips to get the best from your optimisation efforts...
When writing an article, the SEF URL setting will automatically adopt an Alias based on the Title of your Article Description. As the name of an Article is probably going to be chosen to help you to manage your filing and administration within Joomla (quite correctly), it may not however, be the best selection for a URL.
For the best solution, continually review the automatically generated setting to ensure you have the most appropriate URL for both search engines (from a keyword perspective) and website visitors (making navigation more intuitive).
Once an Alias has been configured, individual pages can then be found by inserting the appropriate URL in the search field of your browser. For instance if the 'Alias' for a page is set to 'domain-names', the correct URL to use would be: www.yourdomain.co.uk/domain-names.html
* please note that leaving the .html extension off will also work when entering a URL in your browser address field. In other words, entering www.yourdomain.co.uk/domain-names should work fine.
Make sure that when you use SEF URLs you ensure any pages (articles) are declared on a Menu, even if you don't want the Menu or the article to be seen. Not adding a page to a menu will stop the www.yourdomain.co.uk/domain-names.html style of URL from working, and looks as though it may give problems when declaring the pages on a sitemap.xml file, inasmuch as Google Webmaster issues a WARNING.
You have an option to add an alias to both the Article and the Menu Item. It appears that it is the contents of...
Menu Item Manager>Menu Item>Article Layout>Alias
that generates the SEF URL (in other words, not the Article Alias).
If you put an article in a sub-directory, use it it your advantage by naming the sub-directory so as to be nicely optimised. Hopefully you can see from the following example URL (with sub-directory called joomla) what we mean - www.villageinternet.co.uk/joomla/sef-urls.html - and yes, it is of course this page!