Presuming that you are running 1.6 ST you get to these settings via:
1. Login as an Admin.
2. Click on Admin Panel -> Click on Emails tab -> click on the email address
3. scroll down to SMTP Settings (Optional).
set Status to Enable.
set SMTP Host: your.mailserver.ext
SMTP Port: 25
Authentication Required: No
4. click Submit.
Note server setting may very from this (you may use SMTP-Auth). If you are running 1.6 ST and do not see this page, then you should check and make sure there are no errors being logged. The file that displays this admin config page is
OSTICKETBASE\include\staff\email.inc.php