Installing Ubuntu Linux on external hard disk..linux experts PLZ HELP  

I am a newbie to Linux.Ive recently got a 80 gb external hard disk (USB powered).I have a a 256 MB ram PC, with Pentuim 3 processor.

I want to dedicate the external hard disk completely to linux and start using it for development.
The external hardisk is in NTFS format with 2 partitions of 40 GB in it.
(I assume i need to reformat it to ext3 filesytem... right?)
I guess on of them is sufficient for Ubuntu Linux.

So guys any idea how should I go about?Linux experts please help.
I would be happy to give u any other information needed.