How do I add a folder to my Windows XP Start Menu?

This is a bit tricker than it looks, but I can show you a way that you can accomplish this that's not too terribly difficult. First off, create a new folder on your Windows desktop by right-clicking on the desktop and choosing New --> Folder.

I named mine "faves" but you can choose another name, of course.

Now go to your Start menu and for each application you want to have show up in your faves folder, simply drag the program's name directly from the Start menu "All Programs; menu to the Desktop. This will create a set of shortcuts for the applications you like the most.

Now, drop 'em all into your "faves" folder. Here's what mine looks like:

At this point you can just drag it directly onto your Start menu by dragging the folder icon onto the word "Start" on the lower left and waiting until the menu pops up:

That, however, creates a shortcut to the folder, not a simple way to get to the individual applications within the folder, so I find it less useful than enabling Favorites (right click on the Start menu, choose Properties and under the Start Menu tab, select "Show Favorites") and dragging and dropping the "faves" folder there instead:

Just drop it on the word "Favorites" here for this to work. Once it's done, you're in like Flynn and any time you want, just move your mouse over to Favorites --> faves and you'll get a simple list of your favorite apps just a click away:

I wouldn't be surprised to find that there are yet other ways to solve this puzzle, but I hope that these two solutions give you enough ideas to achieve the customization of your menu that you seek!