1. Be quiet. Too many moderators think they're actually panelists. They never shut up. Still other moderators won't let panelists engage one another without interjecting a question, a comment, or a snide aside. Don't. Your job is to help the conversation happen, and then get the hell out of the way.
2. Be loud. Your job is to visibly and audibly keep the panelists on track, thus helping the audience feel safe and secure. If it seems that no-one's in charge they worry that they'll be stuck in this room for the rest of their life (see point 9). So be loud about telling people why they're there, what's going to happen, and when it's going to end. Let there be no uncertainty that you're in charge and going to make this worthwhile.
3. Be prepared. Know the subject at least as well as most of the panelists. You can't steer a discussion that you don't understand. Have ready a set of topic-organized possible questions, provocative statements, quotes from third parties, Madonna music lyrics, or whatever conversation starters you think will work. Be prepared, of course, to abandon all of them if the discussion takes an unexpected and interesting turn.
4. Be an invisible conductor. A great moderator invisibly plays his panelists like a life-size set of musical instruments. You're conducting a chaotic and wilful orchestra, so you have to know what instruments you've got and what their strengths and weaknesses are. Don't, however, steer every question: Let people surprise you -- and the audience -- with the notes they're able to hit.
5. Be able to think about more than two things at once. This is a biggie. When I'm moderating I'm typically listening to the current discussion, while thinking about my overall planned discussion arc ... the time ... how long the current discussion has gone on ... and about where I want to go next on my way to closing the arc. If you can't do that sort of thing -- or at least three of 'em -- reconsider being a moderator.
6. Be deferential. You're not the star. The panelists are. The audience is. You're just there to keep things moving and make sure that the next panel starts on time.
7. Be ruthless. While you're not the star, you need to be the audience's advocate on time, answers, and issues. Cut off filibusters. Tell people that you don't think they answered the question. Ask follow-ups. Summarize an audience member's question in a way that makes sense, even if has nothing to do with their deranged question. Even, as a last resort, cut off spirited panel discussion if it is going on too long. (As a rule you'll never get through more than three broad issues in a single panel, so be careful not to over-stuff the thing.)
8. Be clear. Good moderators, like good interviewers, ask short questions and make clear statements. Watch the best interviewers on television, even people like Larry King: Their questions are almost always short, declarative, and direct. Who? What? Why? What about? They want to get the issue on the table and get things going.
9. Be timely. This is so important. Get the panel started on time, keep it moving, and get it done on time. And never let there be any doubt that you're going to pull the trick off. Let people see you confidently check your watch. Let people know that you know there's "only five minutes left". Let people see you confidently keep the discussion moving. Manage time, or don't be a moderator.
10.Be fun. I shouldn't have to say this, but I have experienced enough funereal, unsmiling, self-important, and over-serious (and sometimes all four at once) panel moderators that it has to be said: If you don't have fun, your panel won't have fun, and your audience won't have fun. The world does not need more unfun conference panels.