Select the folder to share on the host.
VirtualBox -> Settings -> Shared Folders -> Add New...
Create a place for the folder on the guest.
cd /home/username/Desktop/mkdir ShareName
note: username is your user name, ShareName is some meaningful folder name
It is very important to select a folder that has nothing in it. If you do select an existing folder all the contents will be copied into the host folder. This is a big problem if you point the folder to /home/user.
And one final step. If you want to add the folder perminantly and mount it each time on startup, add the following line to the end of the /etc/fstab file.
ShareName /home/username/Desktop/ShareName vboxsf default 0 0
And that is it. Now anything you put in that particular folder you will see in both the guest and the host OS.