From "Windows Help and Support" @Vista:
By default, Telnet is not installed with Windows, but you can install it by following the steps below.
Click the Start button , click Control Panel, click Programs and Features, and then click Turn Windows features on or off. If you are prompted for an administrator password or confirmation, type the password or provide confirmation.
In the Windows Features dialog box, select the Telnet Client check box.
Click OK. The installation might take several minutes.