You can boot on it only if the Mac supports that system.
For example, you can not use it on a 2007 Macbook White : maximum OS is Lion.
You do not need to have a system installed in the Mac : this will work even if you put a blank new HD in the Mac.
To boot up from the USB stick, hold down the Option key while starting, and select the key on the startup screen, hit Enter.
Again, the system will be very slow : it would much better to use an external hard drive.
(you can install the system onto a 20 GB partition).