Sure, go to Disk Management (right click 'My computer' -> click 'Manage' -> under 'Storage' -> Disk Management, or more simple: start -> run -> diskmgmt.msc) where you can create another (or more) partition(s) on the free space.
If you want to make the one partition you already have bigger, this can't be done with the standard disk management tool of windows XP, but there is 3rd party software that can do this.
Acronis Disk Director Server is one I know of.
Update: There is also the command line tool Diskpart which ships with XP. This program has quite some limitation though.
- It can only 'extend' partitions into unallocated space to the left or to the right (I think this covers your situation).
- System or boot volumes may be blocked from being extended.
- You cannot extend the partition if the system page file is located on the