Just as the operating system divides the possible address space up into pages, it divides the available physical memory up into frames. A frame is just the conventional name for a hunk of physical memory the same size as the system page size.
The operating system keeps a frame-table which is a list of all possible pages of physical memory and if they are free (available for allocation) or not. When memory is allocated to a process, it is marked as used in the frame-table. In this way, the operating-system keeps track of all memory allocations.
How does the operating system know what memory is available? This information about where memory is located, how much, attributes and so forth is passed to the operating system by the BIOS during initialisation.