Fat32Formatter easily prepares external hard drives for use with your PS3
While you could use diskpart to take care of things, not everyone enjoys command-line tinkering. And when there's an easy-to-use alternative like Fat32Formatter -- why bother? Download the sub-200Kb Zip file, extract Fat32Formatter, and fire it up. Select a physical drive from the dropdown menu, click a partition to format, and click the start button when ready. You may also want to check the quick format box -- unless you enjoy watching grass grow or paint dry.
Just in case our less-technical readers didn't see anything out of place in the screenshot, a reminder: C: is not really a drive you want to format.