I found this in a few different places around the 'net - hopefully it's helpful:
Compress Files and Folders in Windows XP
Running out of room on your hard disk? Need some extra space to install a new program? Don't worry, Windows XP comes to the rescue. Both Windows XP Professional and Home Edition now include a zip compression utility that you can use to compress files and folders on your hard disk.
To compress a file or folder:
- Right-click the file or folder.
- Point to Send To.
- Then click Compressed (zipped) Folder.
This will make a compressed folder, identified by a zipper icon, which displays the same name as the file you compressed.
You can also make a compressed folder from scratch, by following these steps:
- Right-click the desktop.
- Point to New.
- Click Compressed (zipped) Folder.
- Open the new compressed folder and drag files inside that you would like compressed.