To add AdSense to your Google Site, just follow these steps:
1. Click the More actions drop-down menu, and select Manage site.
2. Click Monetize on the left side of the page.
3. Click the Monetize this site button.
4. Create a new AdSense account or use an existing account. Follow the instructions, depending on the radio button you select.
Once you've enabled AdSense, go to any of your site's pages, click Insert, and select AdSense to insert ads within your page. You can also choose to have ads displayed in your global sidebar.
For a list of AdSense specific policies on content, please click here, for Sites, click here.
Note: If your site isn't publicly accessible, you'll see a message that your site can't display targeted ads.