To validate an XML Document against and XML Schema (XSD) you need to associate them in one of 2 ways.
Option 1 - Open the XML Document and click:
This will add a schema location attribute to associate the XML document with the XSD.
Option 2 - Open the XML Document and click:
Tools->Schema Used to Validate XML
This will add an internal association within Liquid XML Studio, but will not change the XML Document.
When you click Validate, Liquid XML Studio will then will validate the XML Document using the associated XML Schema.