Sounds like you may have a bad set of bearings. You will need to:
- remove the rear wheel from the bike by loosening the axel nuts and the coaster brake
- then remove the axel from the wheel, there should be a retainer clip that can be removes from a groove in the axel, once removed, the axel should slide out.
- before going further, clean the grease off of the hub and look for some numbers on the inner hub. Most likely the numbers will be 6XXXZZ or 6XXXRS (where the X's will be replaces with numbers) The ZZ designation represents a shielded (metal) bearing set, and the RS represents a sealed (rubber) bearing set. make a note of these numbers, you will need them to order the right size and type of replacement bearings
- drive the old bearings out of the hub using a hammer and punch (don't worry about damaging the bearings, you are putting new ones in, but be careful not to damage the inner hub)
- install new bearings (these are friction fit, they should just push in. occasionally requiring a tap from a rubber mallet, make sure you put the spacer back in between the bearings if there was one)
- re-install the axel (don't forget the retainer clip)
- re-install the rear wheel, attach the coaster brake, make sure that the chain is in alignment, and that the wheel spins freely.
- tighten the axel nuts
You are done! Congratulations.