Start Early
Like after the Fall final exams. Grab a copy of Cracking the Coding Interview or look at Career Cup website and start solving problems. A google search will find you an endless stream of questions.
OCR Seminar
Go to OCR seminar, get yourself enrolled for Oncampus Placement service. You can then start using Zebranet for applying to internships. I started a bit late, and did not understand what people were talking about when they said apply through Zebranet. As a result I missed application deadlines for Bank of America and Goldman Sachs. If you see that your are not eligible for OCR in Zebranet, then it means that you have to go to the OCR seminar.
Arithmetic
Find out what percentage of companies respond positively to interview requests, and what percentage of companies provide offers after an interview. Finding the request approval rate (a), and successful conversion rate (s) gives you the expected number of companies (N) you need to apply so that you have (O) offers at the end of the semester. Many people who did not get internships probably applied to fewer companies, which led to their (O) < 1. You can find the values of (a) and (s) from friends and seniors, from your university. While the values might vary based on experience, GPA, etc, it is good to have a number in hand, and I struggled without knowing how many companies to apply too. Matt Might mentions this in his highly informative blog post, but the link might be incorrect.
Interview Mode
Your performance in interviews influences the hiring decision, more than any thing else. I would even claim that a person's suitability for a job does not influence any thing at all! All stories that you might have heard of some people having 6 or 7 offers by March, might be true. Interview mode, may be?
I use the term only for a vague description of one's ability to face interview questions with fluency and confidence. When you are in the mode, you can see that you are in tune with the interviewer's expectations. It requires practice, even for people experienced in job search, it means slogging a little hard in the early phases. Answers that you gave may be incorrect, or you will discover the fact many days after giving that answer in an interview or always miss one special case or another. But keep working on it, practice a variety of questions. Being in an interview mode is also about identifying pitfalls in your thinking process and develop an ability to make progress in an interview inspite of an initial misunderstanding or mistake.
It is somewhat possible that interviewers repeat questions at many companies, and simply expect you to produce the standard correct answer. Most seem to be not bothered about repeating questions, so it does you no harm if you google and find out these questions and practice solving them.
What's not an Interview Mode
I occcasionally got a few answers right, when casually discussing interview questions. I took it as a sign of me being in a good shape for interviews and did not invest further time. But I was nowhere near successfully solving questions during interviews. Even the easy ones. The bottom line is that delibrate practice works better. Some people have daily time slots for preparation. I worked in batches, and coded this,(which you may realize is not much at all) during my full time job search. And coded some simple interview questions for the company I was interviewing.
And it worked this time, and I think it works only one is an Interview mode. During the internship interviews, I was clearly not in interview mode. I struggled to recollect information about projects listed in the resume and flattered at questions that I would usually cracked.
The Effect of Bad Interviews
While good interviews serve as confidence boosters, bad interviews lower your morale. I stopped my internship search, probably because I was tried of doing badly in interviews. So if an interview goes wrong, think about how you could have done better. It's not that tough.
Luck
Getting short-listed, the questions that you get, the alertness or lack of it of your interview and several other factors outside of your control determine whether you are offered an internship. In my experience, getting not short-listed for a job that you think you can get was the most disappointing thing. But it happens to every body and let that not dampen you. I do not know, if job filters can not read PDFs. Steve Yeggie recommends plain text resumes.
Get in touch
I do not think it is enough to just prepare well for interviews. If you do not get lucky, you may not get sufficient interview invites. People who cracked the internships right at the end of the semester, did not just stop at applying to companies. They followed up with recruiters on linkedin, mailed them and almost left no stone unturned in getting an interview call.
Code repository
It is useful to have an online code repository of your projects. Some companies require people to mention their github accounts. Though interviewers typically gauge you for accuracy and speed in interview, seeing your commits might help an engineer an insight into how persistent you can be on solving problems over a longer time frame.
References
Take a look at this and this.
