Look at the person's body language to determine if she is flirting.
If she touches you often, possibly accidentally, this can be a sign of subtle flirting. Other non-verbal cues from both sexes include leaning towards another person while talking, pointing your body in her position and having open body posture. If the person's arms are crossed, chances are she is not flirting.
Ask the individual openly if he is flirting with you.
While this might be uncomfortable in some scenarios, this will clear up the flirtation right away and determine what is happening. There is a chance that the individual did not realize he was sending out subtle flirty signals.
Flirt back with the person if you are interested in her or want to get to know her better.
Smile, be friendly and maintain good eye contact while you are talking. These are methods of flirting that will help you know for sure if the person is flirting or just being friendly.
Confront the individual about the flirting if it makes you feel uncomfortable.
If you are married or in a serious relationship and do not want anyone flirting with you, tell the person you do not like it.
Avoid the flirty individual if she is not someone you are interested in dating or getting to know better.
Direct communication is sometimes better, but in places like the office, avoiding the person might be a more tactful approach.