New External Hard Drive Need Help Pls

Today I purchased a new External Hard drive So i could Install Os I have Partioned the External Hard drive and i still dont see it in disk utilities the Volume Format Is Ms-Dos file System Is that the Correct Way to Partion Im New at This Please Help Using a Ibook g4 Os x 10.4.11

Ok i tried that and i get a yellow icon with a hard drive and i cannot click on it to install os i get this
You cannot install Mac Os X on this Volume .. Mac os x cannot start up from this volume

The right way to format it is "Mac OS Extended (Journaled)"
Formatting & Partitioning a Hard Drive in OS X Scroll down to the Tiger part.