How do I build a house for my NPCs?

It has to to be 6 blocks tall and 7 blocks wide. It needs to be made from wood. It also needs to at least one chair, one table, a torch, and a wood floor.

NOW REMEMBER - You have to unlock all the NPC's. The Guide is the only one that's free. If he never moves in the house then just wait, it takes time. Leave the house for a while. Later, when you come back he will be in the house.

How to unlock NPC's

• Guns Dealer : Carry a gun in your inventory.
• Mechanic - You can find her in the Dungeon, just make sure to kill Skeletron before entering.
• Merchant - I think you need at least 50 silver coins.
• Demolitionist - You need at least one bomb in your inventory and the Merchant.
• Nurse - You need to have used at least one life crystal.
• Goblin Tinkerer - After you defeat the Goblin Army look on the map, then head to where he's at. When you first see him he will be called the Bound Goblin. Tap (or click) on him and he will begin talking to you. Then make the house.
• Dryad - Defeat a boss, King Slime doesn't count.
• Santa Claus - It has to be somewhere around Christmas.
• Party Girl - Has a fairly rare chance to spawn after having eight NPC's. Also, make sure that the chat doesn't say (NPC's name) needs to settle down or she won't spawn.
• Truffle - Only spawns in Hardmode (activated after the defeating the Wall of Flash). Not only that, he can only spawn in player made surface glowing mushroom biome.
• Pirate - Only spawns in Hardmode. Is unlocked after defeating the Pirate Invasion.
• Wizard - Rare spawn underground after Hardmode is activated. There are some more but it will take lots of explaining.

REMEMBER - if you see a message like (NPC's name) needs to settle down, then build a house.

While it says empty 'house' it really means empty room. It needs to have a door as well as the light source, table chair and background walls (Also needs the walls that stop baddies from getting into it :))

There is a size requirement however, and I do not think the roof above a 7x8 house would be large enough to entice an NPC to stay there. (I usually build about 10x5 rooms or so and the NPCs never complain :))

NPC houses require all four sides to be covered (2 side walls, ceiling, and floor) and then have a background wall, a door, lighting, and furniture. I usually make mine a little bigger than the space requirement, and I also put a door on BOTH walls just in case, have two torches in the ceiling corners and place a table and one chair on either side of it, all just to be safe. The only other requirement that NPCs have is that the background wall is not a dirt wall, it's the only kind of wall they don't accept. If that's what you were using then there's your problem. =)

In addition to the other answers, it might be worth noting that your house can sometimes be too small even in its smallest allowed size.

This happened to me when I built 6 block by 6 block houses and the doors had been opened towards the interior of the house. This seemingly shrinks its size (I assume that's because an open door counts as wall).

I recommend building slightly bigger houses to compensate for this, or else NPCs won't respawn unless you close the doors.

You need to have a building with a width of at least 10 and a height of at least 7, fully enclosed in walls. There must be background walls, a chair, a table, and torches.

For the first house you build, and every other house, you have to have it be anywhere from 60-750 blocks for area (most people use 6x10 houses). There has to be a chair, and for the first house use a Workbench as the table. For the rest of the houses you should use a table because it will take up less wood. You also need full background (I recommend wood background since it will look nice and you can craft it easily) and a light source (1 torch will work). Finally, just place a door on either side.

That's all you need!

Try building a 14 block wide house then cut it in half for a door to fit. Then put a crafting table and a chair in each part and select your npc. Click on the house and move so that you can't see the house and the npc should move in. Also you need to place a torch in the house for this to work. :)