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This is the easiest way to NTFS format your USB drive within XP. I've found this on the net.

Note: After NTFS formatting, you always have to use Safe Removal, you can't quick remove your drive!

Excuse my mistakes, I'm from Hungary :)

Step 1: Run Device Manager

Get to Run in Start menu, and type devmgmt.msc, then press OK.

Step 2: Select Properties

Press the + sign next to Disk drives, and find your drive. If you have no idea about it's name, then remove your drive, and it will disappear in the list, so you know it's name. Plug the drive in.

Right-click on the drive, then select Properties.

Step 3: Change Policy

In the window choose Policies tab, then choose Optimize for performance (the Optimize for quick removal is the default)

Windows' default policy is that you can remove your drive any time, but after this you won't be able to do so.

Step 4: Now Format Your Drive

As you can see, you have the ability to format your drive either FAT, FAT32 or NTFS.
Why would you want to do this, is it faster in any way or something?
I did this with a drive because I wanted to store some image files (FAT won't accept single files >4gB). It made data transfers of other files on the drive noticeably slower. The only advantage to going NTFS that I am aware of is the file size restriction in FAT.
I don't know, but it decreases the lifetime of the drive, because it's a journaling format. Your HDDs are formatted NTFS, if you're using Windows.
This seems nice. Thanks, I will try this.
The only problem with this setup is that because of the way NTFS journaling works, the USB drive will not last as long as it normally would. USB drives have a limited number of read/write cycles, and because NTFS is a journaling file system (meaning that disk transactions are logged separately on the disk as they occur), there is much more disk activity, leading to a shorter drive life. On the other hand, the life span of heavily used flash memory is measured in years, so this isn't that much of a problem. A plus of using NTFS is that you can now install Windows on to the USB drive. Good, simple Instructable.

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