Can I install a My 80Gb External Hard Drive out of the shell into My Compaq Presario 5304 PC?

Presently there is a 4Gb installed, and it is humming loadly and clicking, and freezes up right after I get online. When installing this 80Gb HD will My PC acknowledge when I Install Windows XP PRO? or will I need to change the settings before I install before formatting? If so, what should and how should I set the settings at?Can I install a My 80Gb External Hard Drive out of the shell into My Compaq Presario 5304 PC?install it, reformat it, install XP but make sure you install it internally and not externally