How do you perform Contact Fusion?

In order to Contact Fuse, the monsters must be on the field (face-up or face-down). You declare to your opponent that you are performing a Contact Fusion and reveal the monsters you will be fusing on the field. Then you must meet the cost of the Contact Fusion by sending the Fusion Material monsters back to your deck (like for Neo Spacian & Neos fusions), to the Graveyard or out-of-play (like for any VWXYZ Fusion monsters or Armitael, Phantom of Chaos) and Special Summon your Fusion Monster (this does not count as a Fusion Summon). If you have the Fusion Material monsters but the Fusion monster you are trying to get is not in your Fusion deck, you cannot Fuse.

It's important to note that this is all done in "one fell swoop". In other Words, your opponent doesn't get a chance to respond or chain to your Contact Fusion when you declare it to maybe destroy one of your monsters. After you Special Summon the monster, a card can be activated (like, unfortunately, a Bottomless Trap Hole or Solemn Judgement to destroy your new monster...).

I hope this will clear up anything you wanted to know about Contact Fusions, but you can always check out this link for clarification:

http://metagame.com/yugioh.aspx?tabid=33&ArticleId=9634