What you are trying to do is make a "saddle stitched" booklet.
There are numerous steps to accomplish this, but let us go over the most important.
As Heather Ball well noted, when you lay out the book using a page layout program (InDesign, PageMaker or Xpress) you create the pages in the order in which they will be read.
Then, prior to printing, you use the software's functionality - in InDesign this function is "InBooklet" - to impose the pages together into a form that printing requires.
However, due to your requested specifications ("5.5 by 8.5"), there will be a few catches
I) When you create a booklet you must fold pages (signatures) in half to create the final booklet form. When you create a booklet that has more than, say, 8 to 10 signatures the thickness of the paper will cause the center pages to move outwards, away from the bound center, more than the beginning pages. This is called creep.
When a booklet has noticeable creep the only way to counter this is to trim the final booklet, once bound.
This is important when we also take into account one other aspect of creating your (own) booklet (and probably the most important!)
II) The specifications you gave, "5.5 by 8.5", are for a half-folded Letter-size (8.5" by 11") page.
We will therefore assume that you will be folding Letter pages.
However, no printer (laser, inkjet, dye sublimation or anything else you will have access to) can print a completely borderless 8.5" by 11" page.
THIS IS IMPORTANT!
During your layout you will create individual 5.5 inch by 8.5 inch pages. But the printer itself will only print (given a good laser printer, which is what you will be using to make copies) approximately 8.27 by 10.65 inches on the page.
And since you will be folding the page down the center, the margin area (the non-printable area being subtracted from the overall space by the printer, due to the printer's paper handling mechanism) will only come off the edges of the page and not the (folded) center.
Add in creep, if your booklet will turn out to be more than (say) 7 pages...and the readable space inside your "5.5 by 8.5 inch" booklet will be far less than what you think it will.
This must be accounted for during the layout of the publication.
To make a long story short(er):
the readable space within a publication of your specifications will by approximately 5 inches wide by 8.25 inches tall - once you account for various inconsistencies in the printing / binding / layout process.
If you wish to make a cover or pages with full bleed - image content that goes all the way to the edge of the booklet's paper - then the booklet size must be reduced even more to allow for trim.
The booklet can get small rather quickly when you start accounting for creep / trim / printable area / margins / bleed (if desired).