For time machine i need to format my external first?

I don't believe so. It does have to have the correct format though: I believe Time Machine will only work with HFS+ formatted disks.

 

It does not need to be empty, but it has to use the correct format (file system).

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Overview of the four major file systems (called "Formats" in Mac OS X) used on Windows and Mac OS X, compiled by GGJstudios. You can use Disk Utility to format any HDD to your liking.

Any external hard drive will work with PCs or Macs, as long as the connectors are there (Firewire, USB, etc.) It doesn't matter how the drive is formatted out of the box, since you can re-format any way you like. Formatting can be done with the Mac OS X Disk Utility, found in the /Applications/Utilities folder. Here are your formatting options:

FAT32 (File Allocation Table)

• Read/Write FAT32 from both native Windows and native Mac OS X.
  [*]Maximum file size: 4GB.
• Maximum volume size: 2TB
• You can use this format if you share the drive between Mac OS X and Windows computers and have no files larger than 4GB.

NTFS (Windows NT File System)

• Read/Write NTFS from native Windows.
• Read only NTFS from native Mac OS X
  [*]To Read/Write/Format NTFS from Mac OS X, here are some alternatives:
  • For Mac OS X 10.4 or later (32 or 64-bit), install Paragon (approx $20) (Best Choice for Lion)
  • For 32-bit Mac OS X, install NTFS-3G for Mac OS X (free) (does not work in 64-bit mode)
  • For 64-bit Snow Leopard, read this: MacFUSE for 64-bit Snow Leopard
  • Some have reported problems using Tuxera (approx $36).
  • Native NTFS support can be enabled in Snow Leopard and Lion, but is not advisable, due to instability.
• AirPort Extreme (802.11n) and Time Capsule do not support NTFS
• Maximum file size: 16 TB
• Maximum volume size: 256TB
• You can use this format if you routinely share a drive with multiple Windows systems.

HFS+ (Hierarchical File System, a.k.a. Mac OS Extended (Journaled) Don't use case-sensitive)

• Read/Write HFS+ from native Mac OS X
• Required for Time Machine or Carbon Copy Cloner or SuperDuper! backups of Mac internal hard drive.
  [*]To Read/Write HFS+ from Windows, Install MacDrive
  [*]To Read HFS+ (but not Write) from Windows, Install HFSExplorer
• Maximum file size: 8EiB
• Maximum volume size: 8EiB
• You can use this format if you only use the drive with Mac OS X, or use it for backups of your Mac OS X internal drive, or if you only share it with one Windows PC (with MacDrive installed on the PC)

exFAT (FAT64)

• Supported in Mac OS X only in 10.6.5 or later.
• Not all Windows versions support exFAT. See disadvantages.
• exFAT (Extended File Allocation Table)
• AirPort Extreme (802.11n) and Time Capsule do not support exFAT
• Maximum file size: 16 EiB
• Maximum volume size: 64 ZiB
• You can use this format if it is supported by all computers with which you intend to share the drive. See "disadvantages" for details.

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As mentioned above, correct format but not empty. I had TM set up on my macbook for 2 years and then bought my iMac. The same external has a TM backup of both with no need to format.

If you'd been using the drive on a PC though you will need to format it first.

 

When I first hooked up a new 1Tb external drive for backup use, by selecting that drive in the Time Machine preferences window (in Sys Prefs), by selecting the drive, Time Machine mounted it.

And every time the drive was powered up, the icon on the desktop identified as the Time Machine choice by coloring the icon blue. Easily spotted.