Yes, you need DTR going thru a 100nF cap to the reset pin on the '328, which also needs a 10K pullup resistor to its Vcc. Otherwise, as JohnW says, a momentary reset switch to ground that you press & release when the IDE says "compiled sketch xxx of 32,xxx bytes" (some message along those lines).
Check that Rx/Tx lines are not swapped, that is another common problem.
Or not hacing all the grounds connected.