If you choose to upgrade, the Windows Setup program asks you to enter a few pieces of information,

If you choose to upgrade, the Windows Setup program asks you to enter a few pieces of information,
including the product key; the remainder of the process continues completely unattended.
Setup replaces your existing Windows files, but it preserves user settings, such as
desktop appearance, color schemes, network connections, and so on. It also retains the
programs you have installed and all their settings. (As noted earlier in this chapter, the
Upgrade Advisor report identifies any programs that are incompatible with Windows XP.)
After several reboots that typically require no attention from you, the upgrade installation
completes, and you’re ready to pick up where you left off—with Windows XP as your new
operating system.