To upgrade to XP Professional you need an XP Professional "Install" or "Upgrade" CD. The Upgrade CD is cheaper (though not by much). You cannot upgrade to Professional from an XP Home CD.
Once you have either of those, you upgrade by:
1) putting the CD in while you're in windows and following the instructions
2) putting the CD in and restarting your computer to boot off of it.
Both methods accomplish the same thing.