Are you using Boot Camp? If yes, then from OS X use Boot Camp Assistant and delete the current Windows partition. Now use Boot Camp Assistant to make a new partition and install Windows. Put the XP CD in when prompted by Boot Camp and the computer will restart into the XP installation routine. You *must* format the partition again using XP's NTFS. You can use the Quick Format. After that, the XP install will continue. After Windows is installed and you have booted to the Desktop for the first time, insert your OS X installation disc to install the Boot Camp drivers.
If you are not using Boot Camp but are using Parallels or VMware Fusion, please tell us.
MS-MVP - Elephant Boy Computers - Don't Panic!