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Is it possible to create a usb bootable version of Windows 7 just like ubuntu??

I mean boot the actual operating system and not the installer from a usb?

Ivo Flipse
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Yes, you can using WinPE or BartPE

This is normally used to create Live CD's, but you can achieve the same result using a USB stick.

Here's an example of a BartPE installation for Windows XP

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Note that the performance is likely to be pretty crappy unless you use a really stripped version of Windows.

For steps on how to do it: here's a tutorial

Gaff
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Ivo Flipse
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    Oh I just read on the BartPE wikipedia article that the program can't make them for Windows 7: BartPE cannot create Windows Vista, nor Windows 7 Live DVDs. – Ivo Flipse Feb 25 '10 at 18:53