Snap a chalk line on each side of the concrete slab to mark the outline of the walls.
Begin laying the polystyrene blocks onto the concrete slab along the chalk lines, attaching them to the slab with silicone caulk. Start to lay the blocks in the corners of the slab, and work out toward the center. Keep the blocks at the same height around the slab by laying a level across the block you're installing and the previous block, pressing the new block into the caulk until it's the same height as the block you laid before it.
Lay the second course of polystyrene blocks onto the wall, beginning in the corners and working out toward the center of the wall. Stagger the blocks in the second course so that the joints between the blocks in the second course are not lined up with the joints in the first-course blocks.
Measure 4 feet down the wall from one corner, and cover the horizontal joint between the two courses of blocks with fiber-reinforced tape. Wrap the tape around the corner, going 4 feet down the next wall. Place the tape around each corner of the form.
Install wooden bracing around the outside corners of the form, if necessary. Not all systems require bracing, and the installation method can vary, so read the instruction manual for the polystyrene blocks you are using.
Keep adding blocks to the form until the walls reach the desired height, using the same technique. Add rebar horizontally to the walls as you build them up, following local building codes. The polystyrene blocks have plastic tabs inside them where you can place the rebar.
Install rebar inside the walls vertically after you are finished building the form. Follow local building codes when installing the rebar.
Install bracing on both sides of the polystyrene block form to support the form while the concrete is poured. Follow the manufacturer's instructions for the precise installation procedure for the polystyrene blocks you're using.