Start off by listening to a song on repeat. The melody should sink into your brain and flow inside your head so you know the song inside out. Basically, you try to make yourself aware of the song that is being played.
Pick up your instrument and start playing the song. It will be hard to do, but for the first time try to do it while the song is on. That way it will be easier to guess which notes have been played. This further helps in figuring out the chords of the song. Keep playing at least the first verse of the song until and unless you know which chords have been used.
Step 2 will help you in figuring out the key of the song. While there are a few who do this by picking out the lowest note on their instrument, there are a few who opt for the highest note. This helps you figure out the key in which the song has been played.
Once you know the beginning key of the song, it means that half your job is complete. The beginning key is actually the key to all the chords which have been played in the song. It means that most of the chords in the song will be in the beginning key of the song.
Play the bass of the song so that you know which notes have been used at different times.
While major chords will sound bright, the minor chords will sound dull and different. That is how you know whether a major chord is being played, or a minor chord is being played.
Start singing along with the song and play with it if you can. This will help you write down the basic chords which have been played in the song. Notations will be a little hard to figure out in the start, but if you keep practising, soon you will be able to do that as well.