You can create another partition on the same HDD by going into Disk Management (See this for more instructions:
http://support.microsoft.com/kb/309000)
Create a new partition with however much space you want, name the drive (unless it names it for you)Make sure you
remember the name of the new partition, cause you wouldn't want to install an OS on a partition you didn't want it to be on.
When you create a new partition, format it using NTFS.
Say if you want to install XP, stick the CD in, boot off CD, and select the new partition you want it to be installed on.
Once the installation is complete and all, you will be able to access both OS's at the beginning, when you first startup your computer.