First time

I would definitely wrap a good handful of chips in foil and poke just a few holes in the top of the package. Lay it on top of the coals and let it smoke. You will want to make several of these so you can keep replacing them when they stop smoking.

You could also put the chips down in a metal soup can covered with foil on the top and of course a few holes to let the smoke escape. Bury the can down in the coals just a little and you're good to go.

You can use any hardwood chips.. a good rule of thumb is if the tree produces a fruit or a nut it is usually ok to smoke with. The ornamental varieties of these fruit/nut trees are usually ok as well.

Some of my favorites are:

Mesquite

Cherry

Pecan

Apple

Maple

Plum

Apricot

Oak