System Restore can be used to remove any system changes that were made since the last time you remember your computer working correctly. System Restore does not affect your personal data files so you wont lose changes made to these files. Windows XP creates "restore points" every day, as well as at the time of significant system events (such as when an application or driver is installed).

You can also create and name your own restore points at any time. Creating a restore point can be useful any time you anticipate making changes to your computer that are risky or might make your computer unstable. If something goes wrong, you select a restore point and Windows XP undoes any system changes made since that time.

Below is a detailed list of what is\is not restored:
Restored:

• Registry
  
• Profiles (local onlyroaming user profiles not impacted by restore)
  
• COM+ DB
  
• WFP.dll cache
  
• WMI DB
  
• IIS Metabase
  
• Files with extensions listed in the portion of the Monitored File Extensions list in the System Restore section of the Platform SDK

Not Restored:

• DRM settings
  
• SAM hives (does not restore passwords)
  
• WPA settings (Windows authentication information is not restored)
  
• Specific directories/files listed in the Monitored File Extensions list in the System Restore section of the Platform SDK
  
• Any file with an extension not listed as in the Monitored File Extensions list in the System Restore section of the Platform SDK
  
• Items listed in both Filesnottobackup and KeysnottoRestore (hklm->system->controlset001->control->backuprestore->filesnottobackup and keysnottorestore)
  
• User-created data stored in the user profile
  
• Contents of redirected folders

For more information on the System Restore tool, please review these Microsoft documents:

How the System Restore Tool Handles Hard-Disk Space Usage

Microsoft Windows XP System Restore

HOW TO: Restore the Operating System to a Previous State in Windows XP (Q306084)

How to start the System Restore tool at a command prompt in Windows XP

Troubleshooting System Restore in Windows XP (Q302796)