How to do network install in Ubuntu

If you are managing several computers in a school setting, you know how complicated it gets after a quarter or semester. More often than not, it is better to do a complete re-install of the OS in each and every computer in the laboratories – just so you will get all the latest patches and software updates.
Installing over the local network not only makes it easier but also faster since you no longer have to burn multiple copies of the install CD or DVD and have your assistants load them to each computer. Here's how you can achieve this and make life a bit simpler. Note, however, that this is not exclusively for school administrators.
Now, if only there is a way we can automatically push the images to each registered computer in the network, then that'd be awesome.