Why did you download the tar?? Just use the apt-get utility from the command line or the Add/Remove program from the Applications menu.
Hang on, you do have internet on your Ubuntu machine, don't you?? If you don't its a bit hard to install programs.
Here, try out
www.getdeb.net ... it lets you download .deb files just like .exe files for Windows. There should be one for Pidgin on that site. See if that works. But most likely there will be dependency issues.
However, as far as the tar file you downloaded, here's the procedure.
Extract the file to its folder...lets say /home/pidgin
Then navigate to that folder...lets say cd /home/pidgin
Then run the following commands:
./configure
make
make install
This is assuming that you have all dependencies for this program and that you have the compiler and build-essential tools installed on your Ubuntu computer.
If you are confused about what I just said, please check out ubuntuguide.com ... They have excellent guides for newbies about how to install software in Ubuntu etc. That's what I used...