The MP3 tags can store the song lyrics as well as other info. Many tools are available for this. One such is JetAudio Lyric Maker. Available with JetAudio, which can be downloaded form http://www.jetaudio.com
After installing jetaudio, follow these simple steps
1. Start Lyric Maker: Goto Start->Programs->JetAudio->Jet Toys-> Lyric Maker
2. Open the song: Click file menu, and open. If a tag is already there in the song, it will ask u to load that lyric or remove it. As you want to add a new lyric, choose "Dont Load"
3. Paste the lyric text in the big text box, enter the sont title, artist and lyricist info (all optional). Make sure there is atleast 1 blank line between every two lines and the lines length is not too long (If u copied the lyric form this forum, u need not worry abt the line lwngth, just insert blank lines between every 2 lines)
4. Move the cursor to the very start of the lyrics, Play the song by clicking the1st button on the toolbar (or by pressing F2). Keep ur finger on F9 or ur mouse on the blue check mark in the toolbar. When u hear the first line press F9 or click mouse. Lyric maker will insert timecode and forward to the next line. Do it for alll the lines in the lyrics.
5. When u have finished the song, choose "save lyric to tag" from file menu or press CTRL+S. You are all done. Now when u play the song in certain players like Windows Meida Player, JetAudio or WinAmp, a window will be displayed, showing the lyrics as the song proceeds.
Pictures of step 1-5 attached for reference. Lyric maker is just one such tool but there are lot more available. Have fun and dont forget to credit PakMusic.com|PakStop.Com in your lyrics.