If you installed mod_python from a Linux package you probably already have this line in your httpd.conf:
LoadModule python_module modules/mod_python.so
Otherwise add it.
<Directory /absolute/path/to/psp/enabled/dir> AddHandler mod_python .psp .psp_ PythonHandler mod_python.psp PythonDebug On </Directory>
The lines above must be included in the Apache httpd.conf file or in the .htaccess file. The <Directory> directive must not be used inside the .htaccess file. Instead use only the three internal lines.
The AddHandler directive is telling Apache to pass the files with the extensions .psp and .psp_ to be handled by mod_python. The .psp_ extension is used for debugging.
The PythonHandler directive is setting the PSP handler to be the mod_python handler in that directory.
The PythonDebug directive will enable the display of the interpreter's error output and also the intermediate Python code produced by the PSP parser. This directive should be turned off in a production server.