How do you prepare to preach an expositional sermon? What steps are involved?

Different preachers will develop slightly different ways of preparing sermons, which is fine. Do what works for you. That said, here are some steps that should be involved in the preparation of any expositional sermon.

1. Meditate on the text deeply. Spend time reading the passage you’re going to preach on over and over again. Pray through the passage. Ask God to illumine your understanding of the text and to bring your life into conformity with the meaning of the text.
2. Study the text closely. Examine the text in great detail. Discover the literary structure. Trace the flow of the argument. Look up the meaning of difficult words or phrases. Consult commentaries and other resources after spending serious time thinking about the text on your own.
3. Outline the text exegetically. Summarize what each part of the text contributes to the whole by writing a detailed exegetical outline.
4. Identify the main point of the text. Once you’ve done all this work with the text, identify and summarize the main point of the text. If you can’t summarize it in one sentence, you’ve still got work to do.
5. Come up with a sermon outline that communicates the main point of the text. Based on the exegetical work you’ve done and the main point you’ve identified, find a way to structure your sermon that communicates this main point in a simple and memorable way. Your sermon outline should give your congregation something to hang their hats on, a way to easily understand the point of the text and easily follow the sermon.
6. Think carefully about application. Think about how the different points of the sermon apply to people in different spiritual states: Christians and non-Christians, the complacent and the hungry, the legalistic and the hedonistic. Think about how your sermon applies to people in different stages of life, like parents, children, students, and seniors. And think about how the points of the sermon apply to different spheres of life: the church, the home, the workplace, and public life. 
7. Write out the body of the sermon, whether notes or a manuscript. Write out the content of the sermon in whatever form works for you. That way you will give specific thought beforehand to what you’re actually going to say.
8. Dress it up: add illustrations, an introduction, and a conclusion. While the meat of your sermon is far more important, introductions, conclusions, and illustrations help your hearers see how the text’s point intersects with their lives.