There’s so little useful information on the matter so I’ve decided to post about it. And the default option under Preferences -> Tabs called “Open new windows in a new tab instead” does not work. I have no idea why, and I’m embarrassed on behalf of Mozilla that it doesn’t. However here’s how you fix it.
This is what you have to do to have Firefox 4 open your links in a new tab instead of a new window.
1. In your URL bar enter “about:config”.
2. Accept the prompt.
3. Search up the line
4. Change the default value “2” to “0”.
Once you’ve set it to “0” it will immediately work.
Further refrence can be found here http://kb.mozillazine.org/About:config_entries