This news broke last week, but I decided to sit on it for a bit to see if any fresh information would come to light in the meantime, which it has.
HBO have officially commissioned a pilot episode for their adaption of George RR Martin's A Game of Thrones, the first book of A Song of Ice and Fire. The pilot, the script for which has already been written, is now in the pre-production phase and producers David Benioff and D.B. Weiss are already looking at casting and filming locations. The new information to emerge today is that the most likely filming location is the UK, which is a slight surprise given that HBO were earlier looking at Eastern Europe, New Zealand, Ireland and Spain. I'm going to hazard a guess that HBO were tempted by our excellent pool of acting talent here in the UK and also the declining pound against the dollar, which makes the UK a more viable filming location for American productions. The fact that the BBC is co-producing the series with HBO (as they did for Rome) may have also factored into the decision.
Any final casting decisions are likely a while off, but Weiss and Benioff are asking for ideas to be submitted to the appropriate forum on Westeros.org.
GRRM comments on the news here. The Hollywood Reporter talks about it here and Variety discusses it here. Benioff and Weiss reveal news about shooting location and briefly touch on the thorny issue of the younger characters' ages here. A new subforum has been set up on the Westeros website to discuss the series and casting, which Weiss and Benioff have confirmed they will be keeping an eye on for inspiration and ideas.
As for when we will likely see this on the air, HBO will need to greenlight the full first season beforehand. That is reasonably likely given they want to up their original series quotient and also want to return to the 'good old days' (of only a few years ago) of big, epic productions. That said, only six of the ten ordered pilots will go to series. A Game of Thrones has an excellent chance of making the jump, but it's not in the can just yet. Once that decision is taken, obviously production will be a lengthy and complex process. I would not expect realistically to see this on screen for another two years from now.
EDIT: A new blog established here is covering every piece of news about the series and offering up some interesting speculation and ideas. Well worth a look.