Use the command prompt.

When the Command Prompt opens, enter the following command:
DISKPART and hit enter.
LIST DISK and hit enter.
SELECT DISK 1 (Replace DISK 1 with your disk number)
CLEAN
CREATE PARTITION PRIMARY
SELECT PARTITION 1
ACTIVE
FORMAT FS=NTFS
(Format process may take few seconds)
ASSIGN
EXIT

Note the drive letter of the boot windows CD and enter

D:CD BOOT and hit enter. Where “D” is your DVD drive letter.
CD BOOT and hit enter to see the below message.
BOOTSECT.EXE/NT60 H:

Copy the boot contents into the Flash Drive

Reference:-
http://reviews.cnet.com/8301-31012_7-20020513-10355804.html?part=rss&tag=feed&subj=Windows7Insider