The anntena unplugs from the back of the radio. I am not familiar with XM radio modulators, but I have used a CD changer with an FM modulator and I would think it's the same concept.
Unplug the antenna from the radio, plug in the FM modulator, and then plug the antenna into the modulator.
You would then tune the radio to a specified frequency and turn on the XM to recieve satelite signals.
Hope that helps