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If your goal is to boot Windows 8 from a USB flash drive, then the easiest way to accomplish that goal is to use a feature called Windows To Go.
If on the other hand, you need to boot Windows 7 from a USB flash drive, then using Windows To Go will not be an option. Instead, you will have to use the Boot to VHD feature. In doing so, you will create a virtual hard disk containing the Windows 7 operating system, and then place that virtual hard disk onto a USB flash drive in a way that allows it to be booted. This technique also works for other versions of Windows.
The procedure for doing this is straightforward. The first thing you will have to do is download a utility called PWBoot. You are also going to need a computer that is running Windows 7 or Windows 8, and a copy of the Install.WIM file from the Windows 7 installation DVD.
PWBoot is a wizard-driven utility. Start PWBoot and tell the software you want to install Windows. The next screen will ask for a Windows installation image. Point PWBoot to your .WIM file and select the Enable Boot from USB check box.
The next screen requires you to pick an installation target. Choose the option to create a virtual hard disk image. You will then have to set the image size and path. Be careful to use a size that is small enough to fit on your flash drive.
On the wizard's last screen, make sure the Update Boot Code checkbox is selected and the Overwrite Existing BCD Store check box is not selected (this is very important). Click the Install button to write the virtual hard disk and the required boot files to your USB flash drive.
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