There are many ways to think about how to prepare a lit review, but I think there are three key actions: scan, select, organize. Keep in mind you may find these steps do not occur in order, or may be repeated multiple times
Once you come up with a research topic, it's time to see what people are saying about it. When you scan, you want to pay attention to key terms and topics, not necessarily understand the entire arguments. Note the authors and publications that cover your topic.
After you have found a good set of documents, start to identify ones that are relevant to your research topic. At this point, you should start to refine your topic, considering how your research is an argument based on these resources.
Now comes the time for judgement. Based on the things you have read, you should be able to contextualize your research project. When finished, a lit review provides the basis and context for your study.