A disk cache component called ReadyBoost has been introduced by Microsoft in its two latest offerings Windows Vista and also Windows 7.
Although it is best to physical add new RAM to your system, it is possible to improve the performance by using an external hard drive by about 5-10% using flash memory, a USB flash drive, SD card, CompactFlash or any kind of portable flash mass storage system as a cache.
How to enable Ready Boost in your external disk:
1)Go to My Computer
2)Right click on your device
4)Click on the ReadyBoost tab
5)You can select various options/space allotment from there.
How to enable/disable Ready Boost in your system:
1)Go to the Control Panel menu option.
2)Click on Performance Information and Tools
3)Click on Advanced Tools in the left hand navigation bar.
4)Click on Configure my Windows ReadyBoost device
5) Select the options you want.
You can even check the performance imporvement by :
1) Go to Control Panel menu option. Change to classic view options
2) Click on the Administrative Tools icon.
3) Click on Reliability and Performance Monitor icon.
Under the monitoring tools category, click on performance monitor