OS MCA 106 Blog

There are three ways to install Windows XP: a clean install, an upgrade install and a repair install. Then, there is a "recovery" install, which is not an install in the true sense of the word but rather the restoration of a disk image backup.

A clean install refers to starting with nothing (either an entirely empty hard disk or just an empty partition or just unallocated space on the hard disk) and ending up with just Windows.
An upgrade install refers to starting with an older version of Windows and ending up with a newer version. Existing data files and applications should not be affected by the upgrade to the newer edition of Windows.
A repair install refers to installing the same version of Windows on top of itself. This is used to fix a broken copy of Windows and existing data files and applications are not affected.
A "recovery" is typically used to restore a computer to its factory fresh state. All data files are wiped out. All applications installed since the computer was new, are wiped out. All upgrades to Windows itself (patches, service packs) are lost. Applications pre-installed by the computer manufacturer are restored. Originally this was done from CDs, then DVDs. Now it is normally done from a hidden area of the hard disk.