Yeah, sanding is absolutely vital.
You'll want to sand it smooth and patch any dings or dents with filler.

For the next part, you'll want to set up a clean room or something. Nothing too fancy, just some drop cloths and a box fan to evacuate the fumes. I've seen some people go to the trouble of running all the incoming air through a furnace filter, but I feel that a meter-square patch of muslin does the job fine enough.
Apply primer, sand it smooth again with something north of 480 grit, then wash it down with acetone.

For paint, I recommend a base-coat clear-coat setup. It's almost as hardy as the old stoving enamels, yet it's child's play to get a good looking coat.

Note: The above assumes that painting models isn't all that different from painting cars. Your mileage may vary.