Remove the trim from around the front of the air conditioner and cut off the caulking that adheres to the wall.
Take off the front-facing panel, then pull out the motor assembly.
Use a pry bar to remove the metal jacket that the air conditioner slides into.
Build a frame around the opening with 2-by-4 foot boards cut to fit the dimensions of the hole. Recess the 2-by-4 foot frame 1/2-inch into the opening.
Cut a 1/2-inch thick sheet of drywall to fit the dimensions of the opening and screw it to the 2-by-4 foot frame with drywall screws.
Press joint compound into the openings around the drywall cover and push drywall tape into the joint compound.
Apply another layer of joint compound to the seams and smooth them with a joint compound knife.
Cover the screw depressions with compound and smooth them out with the joint compound knife.
Allow the compound to dry and then sand it smooth with 220-grit sandpaper.
Paint or wallpaper the wall or apply the wall treatment of your choice.
Place a piece of fiberglass insulation with an R-factor of 13 into the opening from the outside. Make certain the paper side of the insulation goes toward the inside of the house.
Cut a sheet of plywood to fit the opening on the outside wall. Attach the plywood to the frame with drywall screws.
Cover the plywood with shingles, siding or whatever treatment you have on your house.