If you are using XP Home on a slightly older machine, your primary partition might be very well FAT32. At least on the two machines that I had with XP Home, FAT32 was the default. FAT32 is a pretty old file system, and lacks many useful features that NTFS brings (transparent compression, sparse files, you name it).
Converting is quite simple, and works without any 3rd party tools. Just run
convert C: /FS:NTFS from the cmd line, answer yes twice, and on the next boot, Windows should convert the partition to NTFS. In case it hangs during bootup (just had this problem recently), shutdown, reboot, and select "last working version" -- which will skip calling convert and just boot up Windows normally.