The proper way to perform the mitzva of taking the four species is to bind the hadasim and the aravot to the lulav. Since it is prohibited to tie a knot on the festival itself, this must be done before the holiday begins.

When one recites the blessing over the four species, they should be held in the hand in the direction of their growth. Thus, when binding the three kinds of branches together, one must ensure that they are facing upward, while the ends from where they were detached from the tree are directed downward.

It is proper to ensure that the spine of the lulav, after the binding, is at least one handbreadth (about 8 cm) higher than the tops of the hadasim and aravot.

There are several customs regarding how to bind together the lulav, hadasim, and aravot. Most Ashkenazim place the three hadasim to the right of the lulav spine, with the aravot to its left. In contrast, most Sephardim, as well as many who follow the customs of the Arizal (the 16th century kabbalist Rabbi Yitzhak Luria), place one hadas on each side of the lulav, one hadas against the spine, slightly tilted to the right, and the two aravot between the two hadasim on the right and left of the spine (see image).

Further reading: For further information on the Arizal, see A Concise Guide to Mahshava, p. 330.

There are also several customs with regard to what to use to bind the species:

Many Sephardim bind the species with any type of thread. Ashkenazim, and some Sephardim as well, customarily use detached leaves of the lulav as bands; these can be removed from the bottom of one’s lulav or from a spare or invalid lulav. Some people make special rings from leaves of the lulav that enable one to bind the species in an easy, convenient manner. One can make such rings oneself or buy them ready-made from vendors of the four species.

Many Ashkenazim use a holder made of lulav leaves woven together, commonly called a koishikel. This holder includes two sleeves designed for inserting the hadasim and aravot, and between these two sleeves there is a hole into which the lulav is inserted. Some argue that in this manner the three species are not firmly bound and connected to each other, and therefore they tie them together on top of the koishikel, or higher up along the lulav above the koishikel.

There is a long-standing custom among Sephardim and Hasidim to attach more than the three requisite hadasim to the lulav, in order to enhance the mitzva. These extra hadasim do not have to be halakhically valid, but they should be positioned so that their tops face upward, like the primary hadas branches.

As for the lulav itself, some do not tie it at all, other than binding it together with the hadasim and aravot. Some add two more rings in the middle of the lulav, so that its leaves will be more tightly aligned with the spine. Yet others tie it in many places (some are careful to place precisely eighteen knots), to prevent it from opening when it is shaken. For this reason, there are those who wrap a thread around the lulav all the way up, almost to its edge, but even they keep the very top of the lulav loose so that it will produce a sound when shaken.

If one forgot to bind the lulav before the onset of the festival, he may bind it on the festival itself with a string or with lulav leaves. In this case, he may not tie an ordinary knot, but should make a bow, or wrap thread around the species, wedging the edge of the thread into the binding. One may also use rubber bands. It is permissible to insert the species into a koishikel on the festival.