How can I store my users' passwords safely?

How much more safe is this than plain MD5? I've just started looking into password security. I'm pretty new to PHP.

$salt = 'csdnfgksdgojnmfnb';

$password = md5($salt.$_POST['password']);
$result = mysql_query("SELECT id FROM users
                       WHERE username = '".mysql_real_escape_string($_POST['username'])."'
                       AND password = '$password'");

if (mysql_num_rows($result) < 1) {
    /* Access denied */
    echo "The username or password you entered is incorrect.";
} 
else {
    $_SESSION['id'] = mysql_result($result, 0, 'id');
    #header("Location: ./");
    echo "Hello $_SESSION[id]!";
}