Hi Bheesham,
You need to create the Milestone its usage and in functions tab you have to select on which factor next activity will be released? As in if the status is REL, or TECO or CLSD..
In basic data tab you will enter the milestone details. this Tab is required to enter the actual dates, Sales Doc Indicator check etc, if you are using the Milestone billing from PS to SD..
hope it helps..
Let us know if you encounter any errors or difficulty in achieving it..
Regards
Sammar