Update: You cannot install Snow Leopard on an 8 GB flash drive. I was incorrect in writing that an install of Essential System Software would take 3.81 GB. As a few of our commenters pointed out, and as is the case, in testing I erroneously tried to install Snow Leopard on a flash drive that already had a version of OSX on it, making the installation much smaller than installing on an empty flash drive. According to readers, installing Snow Leopard on an empty flash drive will take 8.01 GB requiring a 16 GB flash drive. I'm very sorry for any inconvenience this has caused.
It's a good idea to have a strategy in place in case of emergencies. If your hard drive tosses you errors, behaves badly or doesn't even appear, what to do? If programs crash at random, you need to be ready. You can prepare for this by creating a bootable flash drive containing some diagnostic and repair utilities.
This is not meant to replace or in any way affect backing up your hard drive. Time Machine makes it so easy that not having a backup plan is just silly... but so much for the disclaimer.
To make a diagnostic and repair flash drive, I'd suggest buying an
I inadvertently omitted a step! Click the icon for the drive (not the disk partition -- the one that includes the size) and click the Partition tab. Choose "1 Partition" from the pop-up menu, Mac OS Extended on the right, then click Options at the bottom of the screen and make sure "GUID" is the selected partition type. Thanks to everyone who pointed this out.
Insert your Snow Leopard disc and click on Install Mac OS X. Choose your new flash drive as the destination, but when you get a screen or two in, click on Customize.
When you do you'll see this screen:
You can see that it'll take
Run the installation and busy yourself elsewhere for awhile.
When its done, reboot holding down the option key and you'll be presented with a list of bootable devices. Choose the flash drive. The welcome movie will play and you'll need to apply settings as is usual when first running a new Mac or installing a new operating system.
Next run Software Update repeatedly until you get a message telling you that your software is up to date. Now it's time to install utility software. Disk Utility, already be installed on your flash drive, is often all you need, but along with that I can personally recommend Diskwarrior from Alsoft and TechTool Pro from Micromat. I've been using both of those for years and although a lot of functionality is duplicated between these programs, I've often had problems that Diskwarrior can fix but Techtools Pro can't and vice versa. Having both of these in my tool belt along with Disk Utility has gotten me out of serious trouble more times than I'd like to remember.
If you are concerned about running out of space on the flash drive, remember that this is a diagnostic and repair device; you can delete just about all the programs in the application folder. The only ones I have remaining are the three utilities mentioned and Safari. It's your call.
That's it, and putting it together sounds much worse than it is. You'll be set for whatever comes along. Sure you can boot your system disc to run Disk Utility but I've found in many cases, I needed a lot more. You can also boot from your utility program discs, but that's time consuming and it's possible to run into a problem with the OS on the utility disc not playing nicely with your Mac.
You should know that booting the flash drive will take a long time, so don't be surprised. The one I have takes longer than booting from a system disc, but when it does come up, I've got a really good variety of tools that has served me well.
I have one of these in my computer bag and I've used it often at friends houses to get various Macs out of various jams along with using it on the three Macs at home.
Do you use this method already? If you've been at it awhile, what do you use when disaster strikes? The comment section is waiting for your horror stories.
Note: A few have found that rather than the 3.81 GB I found as the size of essential software, on their machine 8.01GB was required. I was testing on a Macbook Pro 17" 2.93 GHz Intel Core 2 Duo, and 3.81 GB was what came up for me. I'm interested in what machines were found to need 8.01GB.