When I was in elementary school, I attended a twice-weekly "computer class" which primarily consisted of repeated runs through some now-forgotten typing software on Apple ][e computers. While running this program, we had to put cardboard boxes over the keyboard (with cut-outs so our little wrists could get in), and let me tell you, cheating was rampant. When a student got to the end of a level in the typing program and reached the timed test, a teacher would stand there with one hand on the box to prevent the "lift and peek," the most popular form of performance enhancement. (I was guilty of that one, though I never graduated to the heinous "oops, where'd my box go?" which could only be perpetrated with a confederate who maintained a distraction for the duration of the test.)
Despite years of continuous typing education, I didn't pick up touch typing until late in the sixth grade. What happened then? Well, I got a job as a typist and simply had to figure it out. I had a job for an online service typing in hardcopy articles (with permission) into their library of ASCII text downloads (the payment was free access to the service). I had to key in something like five articles a week. The first week, typing five articles took me hours...but very quickly I was doing it in just minutes. During this period of rapidly learning touch-typing, I found myself daydreaming about the keyboard, visualizing the keypresses as I thought words. For example, if I thought the word "wombat," I'd see it as a series of keypresses on the keyboard, w-o-m-b-a-t. It got to the point where I wouldn't let myself think faster than I could mentally hit the keys -- that's when I really learned it.
I think everyone's journey to typing is a little different. My typing is pretty standard home-position touch typing. I'm pretty fast, but I make a lot of mistakes. I have several very computer literate friends who have evolved a surprisingly fast variant of hunt-and-peck which relies heavily on index fingers and thumbs. And they seem to get along with it just fine. So here's the question: how did you learn to type? And the bonus question: what typing method do you use? (Do you perform true touch-typing or some personal variant?)