you have an older version of windows XP. you either need to:
A: purchase a newer version of windows (either a newer version of XP or vista)
B: create a partition.
-create about a 40gb partition for XP and/or other applications, download and install the XP updates. after installing the updates you should see the remaining harddrive space within XP's "computer management" application, from there you can format the remaining harddrive space.