In the directory where you plan to install Elgg, do the following:

Create the file .htaccess and add these two lines

RewriteEngine on 
RewriteRule ^testing.php$ modrewrite.php

This tells the webserver to load modrewrite.php when testing.php is requested.

In order to get this test to work on some virtual servers, you may need to add:

RewriteBase /

Create the file modrewrite.php with this line

<?php echo "mod_rewrite works"; ?>

Create the file testing.php with this line

<?php echo "mod_rewrite does not work"; ?>

Now use your web browser to load testing.php. The text that shows will tell you whether mod_rewrite is working.