Installing Windows 7  from a USB Memory Stick (or, a Pen/Thumb Drive) is not only a cakewalk but also blazingly faster than the corresponding DVD install. What you will be needing for this memory-stick-based-install is a 4GB USB Memory stick, since the DVD itself is a 2.8GB approx ISO. Remember, you will be able to boot from the USB stick only if your motherboard firmware supports it. (In simple terms, just plug-in your Pen Drive and reboot, select other boot options, if an option for 'Boot from USB stick' or of the kind shows up, it implies that your motherboard firmware supports USB booting).

Now, mount the DVD ISO image using a image mounting program such as Daemon Tools or Alcohol 120. Then, format your USB Memory Stick to FAT32 partition format. Now, open your Command Prompt terminal and type in the following command as shown below: (check the screen shot below further to get elaborated 😉 )

C:\ xcopy <DVD-ISO Drive>:\* <Memory-Stick-Drive>:\ /e /f

(In the above screenshot, I have used the xcopy command. Here, e:\ is my ISO
image drive and g:\ is my USB memory stick drive. Note the * after e:\. It directs
xcopy to select all the contents of the ISO! )

Your USB Memory stick is now ready to be booted, go ahead and try it out! Tim Sneath`s blog post about Windows 7`s features points out the OS`s following feature:

It’s also worth noting in passing that Windows 7 is far better suited to a netbook than any previous operating system: it has a much lighter hard drive and memory footprint than Windows Vista, while also being able to optimize for solid state drives (for example, it switches off disk defragmentation since random read access is as fast as sequential read access, and it handles file deletions differently to minimize wear on the solid state drive).