Maxed out laptop hard drive

I have a laptop with about 4 gig of space (should say was 4 gig) that is now packed with nothing but windows xp and security updates. Not enough room to put anything else, 800(ish) kb left.

So I went to the store and picked me up a 80 gig external hard drive.....

My question is:

Can I use my external hard drive for everything (OS,boot).......and just leave my normal internal for whatever / nothing?

I was told from my help desk at work this could be done. But, didnt want to look like a total loser and get them to write me a "how to" paper (I have to work there ya know).

Suggestions?

 

Yes you can. You will have to make your external drive the master otherwise the computer will try to boot from that one.