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It is possible to dual boot with XP to set as your Windows 7 already installed. Normally it is always advised to 'oldest' first OS to install. If you have that possibility, is that really the best way, because that is simply included in the XP boot loader of Windows 7.

But running Windows 7 fully equipped and satisfactorily running then this is not an option. If you in the following way to work, you can do without too many problems setting up a dualboot.

Preparation

First make sure you have a separate partition or even an entire disk for XP have Fri.
Have you not, you can use Disk Management to partition an existing drive with enough free space to create.

Open Disk Management by right clicking Computer and choosing Manage.
In the left pane, click Disk Management.
You can also diskmgmt.msc typing in the search field and press enter.

Right click on the disk / partition you want to use and choose Shrink.

What you need to make this partition depends on how many programs you want to install a directive for an XP installation with SP2 can be found here.

Now right-click on the Unallocated space and click New simple volume.
Follow the wizard. Accept all default values, but only for select Quick Format.
Restart the PC for the changes to take effect.

XP

Put the XP CD into the drive and reboot the PC, this time from the CD. If your computer will not boot from the CD
you probably have the boot order in your BIOS settings.
Install XP on the partition you previously created.

The boot manager repair

Now you have XP installed, you can not boot in Win7. To restore Win7 boot loader download
and install EasyBCD and Microsoft. NET Framework 2.0.

Open EasyBCD, click the Manage Bootloader button and select the options and Reinstall Vista bootloader.
Then click Write MBR. Windows 7 uses the same boot loader (BCD, Boot Configuration Data)
as Vista.


Then click on Add / Remove Entries.
Under Add an entry select from the drop down menu NT/2k/XP/2003 Windows.
By Name gives the name Microsoft Windows XP.
Click on Add Entry


 Reboot the PC and select the operating system of choice.

An easier way to Windows XP and Windows 7 together is to use Virtual PC and Windows
Mode XP install. You have a virtualized XP with SP3, XP mode but also allows for software no longer works to virtualize Windows 7. Mode is only available to XP Professional, Enterprise and Ultimate users.