ReadyBoost is a new feature of Windows Vista which uses flash memory on a USB drive to boost system performance. It uses the USB drive as a hard disk cache and/or virtual memory store to speed up file access and increase the apparent RAM available.
By placing many small files on the USB drive, Windows can randomly access these files much more quickly than is normally possible from a hard disk.
The key point is that the USB drive must have very fast seek times. Many USB flash memory devices, even those with high data transfer rates, don’t have sufficiently fast seek times to make them useful for ReadyBoost. Unfortunately, manufacturers don’t normally publish random seek times for flash memory like they do for hard disks.
 Link: Windows Vista ReadyBoost Compatibility List
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