External HD for Home Theater Setup

I'm building a small home theater and I'd like to be able to simply plug in my macbook to the TV and interface it with an External Harddrive where all of the movies are stored. My question is, would a USB2 based HD be fast enough for streaming the movies? I found a 320GB Lacie for a little over 100.00.

Well I have a full size theater in the basement already. This is more so just an alternative for the upstairs TV if I feel like casually watching a movie while doing something else.