Install Windows XP use USB Flash

http://www.eeeguides.com/2007/11/installing-windows-xp-from-usb-thumb.html

To complete this tutorial you need a 32bit version of Windows XP or Windows Vista installed on your home PC.

What you'll need:
USB_PREP8 (alternative download) http://files-upload.com/files/665634/usb_prep8.zip
PeToUSB (alternative download) http://files-upload.com/files/665642/PeToUSB_3.0.0.7.zip
Bootsect.exe (alternative download)
Special Note: If you use the program Nlite be sure to keep the manual installation files as the USB_prep8 script relies on these files.

Extract the files in Bootsect.zip
The next step is to extract USB_prep8 and PeToUSB.
Next copy the PeToUSB executable into the USB_prep8 folder.
Inside of the USB_prep8 folder double click the executable named usb_prep8.cmd.