How To Format USB Drive with NTFS File System
In Windows Xp for formatting USB Drive only FAT or FAT32 Option is there if you wish to enable and use NTFS Format Option
Insert USB drive in your PC.
2 Select Disk Drives and expand.
3 Right Click on USB drive and select Properties.
4 Go to policies tab and select Optimize for performance and press OK.
5 Now Right click on USB Drive and select Format Option.
Now you can have NTFS option there
Reference
Ntfs.com