pjgowtham from xda has posted the instructions to install Cyanogen Mod 7 on Motorola Defy smartphone. The instructor said that it took whole 1 day for him to install this as while installing, he made a little mistake.
So, all can look into the below steps so that they do not get into any trouble.
Instructions for Installing Cyanogen Mod 7 on Motorola Defy
1. Install RSD Lite [Link].
2. Before flashing, it’s good to Factory Reset and Wipe Cache on Stock Recovery before flashing.
3. Download the latest froyo.sbf file. You can download at [Here]
4. Flash this file on your smartphone keeping it in boot loaded mode by pressing Power and Volume Up keys.
5. You can configure the Motoblur or else, skip it.
6. Download Gingerbreak Apk and Root your device [Text Tutorial]
7. [Download] Cyanogen Mod 7 on Motorola Defy
8. Download Google Apps
9. Copy both the above downloaded zip files that you downloaded above on to your SD card.
10. [Download] the 2nd Init v1.4.2
11. Please make sure that you don’t download 2nd Init v1.7 because CM7 will not work on it.
12. Install the Recovery on your smartphone and Reboot twice fully until the home screen.
13. You will be automatically taken into recovery while rebooting.
Please note that if you are unable to go into Recovery then you need to Press Volume Down button when the blue light appears during boot up.
If you are caught in the boot loop then you need to go into Stock Recovery and need to Wipe Data and Cache.
Also, please make note that even you are in Boot Loop, Recovery can be accessed and you can Boot into Blur.
14. Go to Recovery –> Custom Recovery and Format Data and Cache and Wipe the cache.
15. You need to Install zip –> Choose zip from SD card –> CM7 Zip file.
16. Please make a note that you should not format data or cache after you install CM7.
17. Install the gapps zip file (Google Apps) that you downloaded in Step 8.
18. Reboot your phone.
19. Go to boot –> 2nd Init
20. Just wait for some minutes and you will see CM7 Logo.
21. The screen will dim and soon you will be taken to the home screen of CM7.
22. All Done. You have CM7 on Defy 🙂 .
All supports at xda application thread