TFS 2010 integration for build

Hi there, I am using the latest 7.1.2 version of TC and the VCS Type is Team Foundation Server. Also, selected the Runner as MSBuild, now my question is do we need to checkout all folders from TFS and map in TeamCity configuration or TeamCity will itself checkout all code from TFS and put in TC server. Actually I am not sure of how this process works. Would be great if you point any TFS 2010 integration video or step by step document for this.