A Milestone is an event which usually has a deadline, requires something be done or needs special attention. A Milestone helps keep the project team on the right track and also helps the Project Manager have a better overall picture of the project.

For example, you might have a Milestone for 'Delivery 1', 'Delivery 2', 'Final delivery' etc. Key deadlines are related directly to your project but they aren’t project tasks. Use a key deadline as a milestone to reflect when a section of tasks or key task is completed.

In some projects you might have milestones for payment Milestones where the payment terms are linked to project stages, such as '20% on completion of design', '20% on commencement of manufacturing'. When you hit these Milestones something needs special attention (money needs paying!). 

The Milestone is not a task though. Use tasks to get people to do something then use a Milestone to mark that it is done.

* Milestone project start
====== Design

            ========= Purchasing
                  * Milestone 30% payment due on manufacturing start 
                  ========= Manufacturing
                                    ========== Testing
                                                        * Milestone manufacturing complete
                                                        == Delivery
                                                            ========== Installation & Commissioning
                                                                                * Milestone project complete