A good article on configuring Thunderbird to work with YPOPs! is documented at OpenSourceArticles.com

1. Click Tools-> Account Settings
2. Click Add Account button.
3. Choose Email Account. Click Next
4. Type name and email address in the boxes. Click Next
5. Choose POP and type 'localhost' as the incoming server.
6. Depending on your preferences check or uncheck Use Global Inbox
7. Click Next. If your username is not already there by default, add it.
8. Click Next. Add the way you want your Account Name to look in Thunderbird.
9. Click Finish.
10. Now scroll down to the bottom of the Account Settings pane and click on Outgoing server (SMTP).
11. Click on Advanced. Click on Add.
12. Type 127.0.0.1 as the outgoing mail server. Port default is 25.
13. Check Use name and password. This is Thunderbird’s way of enabling authentication.
14. Type your Yahoo user name as This e-mail address is being protected from spambots, you need JavaScript enabled to view it .
15. Click No to Use secure connection and then OK twice.
16. Click OK to the Server Settings window.
17. Now get back into Account Settings
18. Go back to the Server Settings of you Yahoo Account in the Account Settings pane.
19. Do not check Use secure connection (SSL) or Use secure authentication.
20. Click on Advanced.
21. Choose where you want your emails to go in the POP tab.
22. Click on the SMTP tab and click on the drop down menu and select 127.0.0.1:25
23. Continue modifying any of your preferences in the account and then click on OK.

The first time you try to access the account, Mozilla will ask for a password and if you want Mozilla to remember the password.

If you find a need to increase the timeout value when downloading emails, try this:

1. Search for mail.server.serverx.timeout in Thunderbird about:config
2. Add one for the above account for 600 seconds