You can only serIn on Pins: 1,2,3,4

This is how you set up the PICAXE to be ready to be programed.

First of all, program in the program...
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Main:
serin 2,n2400,b0 'Collect data from the Terminal (under Output Buffer) and store it in Byte0.
pause 100
serout 0,n2400,(b0,13,10) 'Output Byte0 data received from the 'Output Buffer' onto the Input Buffer. ie. Print the data in Byte0

pause 100
goto Main ' do it again
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Once programmed, remove the two programming Pins and place a Wire between Leg2 and -ve.
Then place a wire between Pin2 and the Receiving Pin of the Programming Cable, as shown.
 

Now press F8 to bring up the Serial Terminal (under Programming Editor). Make sure the programming cable is still connected. Now type a Letter into the Output Buffer. 100ms later you should see the letter you typed be printed on the Input Buffer window.

Now, some people have noticed that you cannot SerIn using Pin3 (input only pin). I want to show them that YOU CAN!!

Return to programming mode (replace the programming resistors) and now upload the program...

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Main:
serin 3,n2400,b0 'This is the only difference, change the 'Serin 2...' to a 'serin 3...'.
pause 100
serout 0,n2400,(b0,13,10)
pause 100
goto Main

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Now you would think that taking out the resistors and placing a wire between the programming cable and Pin3 would allow you to send data right?
The following picture is pretty much the same as the previous one, with one change. Instead of a wire going from the Programming Cable -> Pin2. The wire is now Programming Cable -> Pin3

Now, bring up the F8 terminal and try getting your data back!

Due to the internal electronics of the PICAXE08, you cannot SerIn using Pin3 without an additional component. You will need a ->
1N4148 Diode - A normal diode which only allows current to flow in ONE direction.

Simply place a diode between +ve and Pin3. Make sure the +ve end is at Pin3.

As you can see, the -ve end of the Diode is at the +ve terminal and the other end is at Pin3. This means that current cannot flow from +5V -> Pin3.