Staple 6 millimeter polyethylene sheeting to the interior side of all of the exposed studs in a wall wherever you will be applying cement board. This barrier captures the moisture that eventually seeps through the cement, thereby protecting the stud framing. This type of wall is used as an underlayment for tiles.
Staple 6 millimeter polyethylene to exterior side of exposed studs, or over the outer plywood sheathing on your house when applying exterior cement board. This type of underlayment is used when applying vinyl siding and stucco. These surfaces can be penetrated by moisture, so the vapor barrier is needed to protect the lumber framing that supports your house.
Staple 6 millimeter polyethylene over drywall in certain situations. Drywall in any room where you will apply cement board for tile walls and vinyl sheeting are two examples of walls that need extra protection from moisture. It is not necessary to remove the drywall if the vapor barrier is covering it completely and the outer wall covering is properly sealed with grout and/or caulk.