Check out the structure thoroughly. Look at all parts of the garage from the roof to flooring. Figure out important repairs before starting to frame any type of room in the space. Check the exterior foundation for any weaknesses, cracks or moisture problems. Find any roof leaks or soft places in roof sheathing under the shingles.
Look for ways to route electrical and plumbing. Design a bathroom, for example, with a drain near the back of the garage wall. Can water lines come through a garage wall from the kitchen? Use attic space to run wiring for light fixtures and outlets. Don't forget to plan for heating and air duct work and vents.
Take down the garage door and tracking. Use an electric screwdriver to remove screws. Build framework for the room space, and where the main garage door stood, using 2-by-4-inch boards. Install studs on 16-inch centers for the room and designated closet space. Insulate between wall studs and add drywall to ceilings and walls. Roll insulation between attic rafters to rest on top of ceiling drywall.
Add interior doors and wood trim to the room. Secure baseboard materials around the room's perimeter. Paint the space next. Roll paint on the walls before laying flooring to prevent spills on hardwood or tile.
Lay flooring last. Use indoor-outdoor carpet, porcelain ceramic tile or hardwood flooring. Go over activities for the room, such as using it for a family game room, before selecting a floor surface. Don't install carpet if a pet will stay in the room a lot -- use tile instead to make cleanup easier.