How is a Christian to live in the world but not conform to it?

We are commanded by God to not be conformed to the world but transformed by the renewing of our minds (Romans 12:2).  We are not to allow the world to influence us as it did when we were lost but allow the Holy Spirit to guide our thinking and change the way we look at things in life.  While this is no walk in the park, it is not as hard as people make it out to be.  First, we must put out of our lives the desires and lusts of the world (1 John 2:15).  After this we are to study the Word of God (2 Timothy 2:15) and pray continually for guidance from the Holy Spirit (1 Thessalonians 5:17; Romans 8:13, 26).  If we stay close to God we will know His will and will not compromise ourselves with the world and sin (James 4:7-8).