I have my laptop wirelessly connected to a USR9108 which is wired to my desktop computer, now here is my question how do I set up a Local Area Network (LAN) between them?
ps: remember, the laptop is connected wirelessly to the same modem which is connected to the desktop.

Thank you,
doulzster

If they are connected to the same modem, they are already networked.

If you've got file shareing turned on, you should be able to go to Start > Run, and type \\nameofothercomputer to see the shared files.

You are already on a LAN.
The USR router is your gateway and deals with this.

What are you trying to accomplish here ?