Normal maps are grayscale images that you use as a height map on your objects in order to give an appearance of raised or recessed surfaces. Assuming you have a model that looks like this:
We want to make the light parts of the object appear raised.
Draw a grayscale height map of your texture in Photoshop. White is high, black is low. Something like this:
Save the image next to your main texture.
In Unity, select the image and enable Generate Normal Map in the Import Settings in the Inspector:
In the Material Inspector of your model, select ‘Bumped Diffuse’ from the Shader drop-down:
Drag your texture from the Project window to the ‘Bumpmap’ texture slot:
Your object now has a normal map applied: