Every dog knows how to lie down. All you have to do is put it on cue. It's helpful if he knows how to Sit on command first, but not essential.
Relationship based dog training philosophy

Yogi Lying Down
1. Stand in front of your dog who is in a Sit, facing him.

2. Put a bite-sized treat between your thumb and forefinger, and hold it just in front of his nose.

3. Say, "Down" as you slowly move the treat straight down to the ground and out between his paws. (Make an "L" with the treat.)

4. As he follows the treat, he will naturally move into a Down.

5. The instant his elbows touch the ground, say "YES!" and give him the treat.

6. Release him from the Down with a release command, such as "Free dog!".

Down

Want to know more? Try Dog Training For Dummies by Jack & Wendy Volhard. Better yet, enroll your dog in an obedience class!