CentOS seems to be popular for servers, as well as Ubuntu Server edition... Also heard good things about OpenSUSE servers.
I would say just use a XAMPP or LAMP (apache) based server on them, since I believe both have support for mail server as well. Lighttpd seems to be an alright choice as well, but doesn't come with the same components as XAMPP or LAMP, you'd have to know how io install things to the server (php-5, MySQL, SQLite, etc). However...
Wongers is right:
bad idea to take on a project that you have no knowledge about but ill try and dig out an old manual for you a bit later on.
Be honest and say you're not very knowledgeable on this topic, and therefore, can not set one up.
Either that or tell your boss that you may need
very ample time to study and figure it out- and then attempt it once you've perfected it.
Until then, check this out:
http://www.youtube.com/watch?v=5pYUZQmM8Bk
(I prefer XAMPP, but Ubuntu Server has direct support for installing LAMP as you are installing the OS).
I also wouldn't recommend using a multi-function desktop OS as a server, like the guy did in the video.
Very easy to look up video tutorials on setting up such a server.
Here is a more full-length video that I found from a quick search.
http://www.youtube.com/watch?v=VUTacvPKn9U