Yes, that is the way it is most commonly done. The alternative is to use a "Network Print Server", so that no particular PC needs to be running to "host" the printer.
1) Connect the printer to the "client" PC, as though it were to be used with that computer, and install it. This ensures that it has all the necessary software/drivers on board.
2) Reconnect it to the "host" PC and, in its Properties, set it as "shared". In the client's "My Network Places" (or Network Neighborhood), the printer should then appear as a shared resource of the "host" PC along with any shared folders. Double clicking the printer in the remote PC should automatically install it as a "network printer" in the "client". This means that the "client" now has the same printer installed twice - once as a "local" printer and again as a "network" printer (with a bar under the icon to indicate a network device). If you are always going to print via the network, you may want to set the "network printer" as the default.
Otherwise, have a look at this Microsoft article. It is an old article written for Windows 95, but the basic principle for installing the network printer should still be valid.