Hi,
First, determine if you have a Seagate hard drive. The Disk Utility will display the manufacturer's name and other information about the drive. At the bottom of the Disk Utility, you'll see the S.M.A.R.T. status of the hard drive. If it says, "not verified," you can virtually certain there is an actual or impending failure detected the the monitoring algorithm's in the hard drive's internal electronics. Using or continuing to use a drive which can not verify S.M.A.R.T. status puts your data at significant risk of loss due to hard drive failure.
Second, if you do have a Seagate drive that is failing, contact Applecare, Apple Service Provider, or Apple retail store. Give them the details including your system's serial number and as much information about the hard drive as you can obtain from Disk Utility and/or System Profiler. I recommend pursuing trying to get Apple to replace the drive even if your MacBook's warranty coverage has expired. There was a much higher than average failure rate on certain Seagate models. It is certainly worth courteously asking for coverage extension.
If you can't obtain a drive replacement from Apple, any brand SATA or SATA-II 2.5 inch notebook drive that is no more than 9.5 mm thick should fit. A vendor such as
http://newegg.com is a good place to check for drives. SATA-II drives are supposed to operate at either 1.5 Gbit/s or 3.0 Gbit/s speeds automatically. Some old drives might need to have a jumper set to limit the interface to 1.5 Gbit/s in order to be MacBook compatible. If possible, ask the vendor to confirm the hard drive you want will work in a MacBook.
On the OS X installer disc, you should be able to use Disk Utility to prepare the new hard drive. To boot up in an Intel based Macintosh, the hard drive partition table needs to be GUID type.