As we reported earlier, Microsoft released a free tool called Windows 7 USB/DVD Download Tool to help you install Windows 7 on all netbooks in simple steps.
Although you can refer the how to install Windows 7 from USB guide to do the same, this tool simplifies the job. Here are the five simple steps that you need to follow to create a bootable USB flash drive to install Windows 7 from USB device:
Note: You need a USB flash drive with a minimum of 4 GB of free space. And also please backup your data from USB first.
1. Download Windows 7 USB/DVD Tool and install it.
2. Run the program, browse to your Windows 7 ISO image using the Browse button.
Note: In case you run into an ERROR in loading a specific ISO image, take a look at this post
http://www.withinwindows.com/2009/11/01/use-the-windows-7-usbdvd-download-tool-with-custom-isos/
3. In this step, you need to select your media type. As we are here to create a bootable USB, simply click on USB device button.
4. Select your USB flash drive from the drop down box and click on Begin copying button.
5. The Windows 7 USB/DVD tool will take a few minutes to complete the procedure.
6. You are done. You can now use this USB on any machine that can boot from USB to start installing Windows 7.