Wireless Router?

I always thought you had to plug a wireless router into a PC for it to work, but yesterday, I just plugged in my router to the modem, and tried accessing the internet with my lapop. I dont have a PC you see. So the router and modem were hooked up upstairs, and I was on my laptop downstars. However, when I tried it today, after about 30 mins, MSN, AIM and all my internet browsers stopped working. I tried to search for a router, and it said there wasnt any. When I went upstairs, the router was still on, with the green lights still flashing, so it was still working. I tried to troubleshoot MSN, and the reason was invalid IP address. All of this confused me, so I'm asking can you tell me why this happened, and how I can fix it?

PS: I just went on MSN, AIM and IE downstairs againm, and once again, after about 30 mins, it just all pazzed out.

Karma will be given.