A common questions when installing Windows XP on your computer is whether or not you should format your hard drives as NTFS or Fat32.

The specifications for both systems are as follows:

Fat32
Use it if your hard drive is 32GB or less.
Is slightly faster than NTFS, but not by much.
Can be used by other Operating Systems. If you plan on having multiple operating systems on your machine, you want FAT32.
NTFS
Should be used if your hard drive is greater than 32GB
Has better compression allowing you to store more data.
Has file security.
In generaly, with drive sizes being by default greater than 32GB, you should use NTFS. NTFS also gives you greater security on your hard drive to eliminate possible unauthorized access of your data.

On the other hand, if you are using Windows 95,98, or ME, NTFS is not an option so you must use FAT32. You will also want to use FAT32 when you have multiple operating systems on one computer.