A Family history video is a great way to share your family history with others. This is a unique thing to do, but it can be even more meaningful to your family. It also gives you the opportunity to see what people looked like, and what they sounded like. This may not work as well for family that you do not have any footage of, but you can still do it. Ken Burns managed to put together great documentaries on people who were no longer alive.
First you should examine all of the information that you have available to you. If you have old videos, that would be a great place to start. This will also give you the opportunity to preserve the videos. You may need to transfer all of your old footage to a digital format. There is equipment you can buy or you can pay someone to do it for you.
You can also look for old photographs that you can use to show what someone looked like. These will need to be scanned as well. You may want to use software to touch up and repair the photos.
Once you have your videos and photos together you may want to do a few interviews with people to supplement the video with. These can be with the subject or with people who knew the subject. Then you will need to begin compiling a script so that you can edit against a timeline. Once you have your basic outline down you may choose to have a narrator to connect certain clips or scenes. For this you may need a microphone so that you can record it directly into the computer.
You should choose software that will allow you to edit clips, and sound separately. This can be a tricky process, but iMovie for Macs makes it a bit easier. Additionally you may consider Adobe Premiere for PCs. While this does require extra work, it will be worth the extra effort. Families cherish these types of videos.