database.yml

development:
  adapter: postgresql
  database: <PROJECT'S NAME>_development
  username: developer
  password: <PASSWORD>
  host: localhost
  encoding: UTF8

test: &test
  adapter: postgresql
  database: <PROJECT'S NAME>_test
  username: developer
  password: <PASSWORD>
  host: localhost
  encoding: UTF8

production:
  adapter: postgresql
  database: <PROJECT'S NAME>_production
  username: developer
  password: <PASSWORD>
  host: localhost
  encoding: UTF8

cucumber:
  <<: *test

The commands you should run

$ sudo su
# apt-get install postgresql
# su postgres
$ createuser -P -s -e developer
Enter password for new role: <PASSWORD>

And now you're ready to set up your project on postgres...