If you plan on using cycles, follow this:
Step 1: Create a blank texture in the Blender Image Editor with no Alpha.
Step 2: Clear all materials from your model or create a copy, then clear. Add a new material and name it something relevant.
Step 3: Select use nodes in the materials. Bring up the node editor and, using Shift+A, add an Image Texture node and Ambient Occlusion node. Delete the Diffuse BSDF node and plug the AO node into the materials Surface port.
Step 4: Set the image texture to the blank texture you created earlier and click on it to highlight it. Select the UVs of the object and move them into the blank texture.
Step 5: In the Bake tab, set the output to Ambient Occlusion. Let it bake at about 500 samples for about 5 hours if you use your CPU, or about 10-15 minutes if you're using an Nvidia GPU.