Best practice is to, on first use of an acronym, use the full series of words, followed by the acronym word in parenthetical statement. After that, the acronym maybe used in text in lieu of words. For example, if you were to make a statement about an Automatic Teller Machine (ATM) and from then on, you can use ATM instead of the constituent words. The parts of the Acronym that make the word must be capitalized. Usually, like in ATM example, this will be the first of every part of the Acronym, with exception to conjuctions ("and", "or", "but", "not") and definitive articles ("a", "an", "the"), but if we talk about the young gentleman's club from Calvin and Hobbes comics that the two characters were involved with, the proper form would be "Get Rid of Slimy girlS (GROSS)" you'll notice the "o" in "of" and "g" in "girlS" are not capitalized. While not a hard rule, the use of a periods in the resulting acronym typically means that the acronym is to be said letter by letter instead of a word. For example, the Royal Air Force (R.A.F.) would be pronounce by the constituent letters, where as Royal Air Force (RAF) is pronounced as the word Raf. Though keep in mind, this is not universal, as ATM is pronounced letter by letter but universally written as a single word format ATM. On the subject of, ATMs, you also want to avoid Redundant Acronym Syndrome (RAS) which occurs when the acronym is used as an adjective for the word the last letter covers for, i.e. ATM Machine. This is because the resulting phrase would be the Automatic Teller Machine Machine if fully said. The only time this is acceptable is that it is always a RAS Syndrome, as the acronym was designed as a joke for this occurrence.
Finally, the military loves them some acronyms and get some bizarre ones. The first one is mashed words like STRATigic COMmand becoming STRATCOMM. This isn't technically the an acronym, but serves the same function of not writing the who word out. The other is the backronym, where the letters are chosen and the acronym is made to fit the letters and give some detail about the thing (often humorous). In these cases, it is acceptable to write it in the reverse format as much as normal format. For example, a popular joke among the U.S. Marines is ARMY (Ain't Ready for Marines Yet) and because of the obvious dropped word, the Army would reply that it's "Muscles Are Required Intelligence Not Essential (MARINE)". Not to be outdone, the U.S. Navy refers to the Marines as "My Ass Rides In Navy Equipment (MARINE)" or "My Ass Really Is Navy Equipment Sir (MARINES)" and both the Marines and Navy agree that it's "Never Again Volunteer Yourself (NAVY)".