The first thing to do is create an image in a size of 16x16 pixels. The design depends on each particular blog, as well as colors and images that you want to.
Now we have our favicon format. Ico, the next step is to upload that image to any image hosting service that supports. Ico formats.
Once we have done all the previous steps we can insert our favicon into the blog. To do this we open the Desing tab in your Blogger account, and click the EDIT HTML and look for the following code:
Just before the this code you have to paste this code:
Remember that were it says http://site.com/favicon.ico you have to replace the favicon url where you uploaded the .ico image. The you save the changes and it is ready, you have your own favicon.