Here are full step by step instructions to boot camp your mac with Windows 7 from OS X Mountain Lion, including instructions in case of error messages.
Prepare an external hard drive for back up
1. In order to prepare your external hard drive, there are two things I would recommend doing. The first is to format your external hard drive as MS-DOS (FAT). In doing so, you are able to use your external drive on both the OS X and Windows sides of your computer.
2. To format your external drive as MS-DOS (FAT) simply connect your external drive, launch Disk Utility (in the utilities folder), and select your external drive on the left hand side. Then select the Erase menu and change the Format drop down selection to MS-DOS (FAT). Then click erase. Now your drive is formatted for OS X and Windows.
If you already have information stored on this device DO NOT erase. It is not a requirement of boot camp to format your external drive this way, but it does make your drive more useful in the long run.
3. Next you want to partititon your external hard drive. This is only necessary if you wish to store more data on your external drive than just a backup. If you are backing up with Time Machine (which I recommend) then partitioning your drive really is not necessary. In order to partition your drive, connect your external drive, open Disk Utility, select your drive from the left, select the Partition menu and change the size of the partition. This will mean that part of the drive is dedicated to your backups and the other part (or partition) of your drive is dedicated to whatever else, which in this case will likely be your Windows backup.
Convert USB to MS-DOS (FAT)
1. In order to downlaod WIndows Support Software through Boot Camp, you must have a USB (it can be very small as it is only storing a limited amount of data) that is compatible with OS X and Windows. This means again connecting your USB, opening Disk Utility, selecting your external drive, select the Erase menu, and change the Format drop down selection to MS-DOS (FAT). Then click erase, and now your USB is ready to downlaod the Windows Support Software.
Back Up Mac with Time Machine to External Hard Drive (Bootable backup)
1. Now that your external hard drive and USB are ready for OS X and Windows, you must back up your computer. There are other programs out there such as Carbon Copy Cloner which you can also use to back up your Mac, but I found Time Machine to be the easiest. Simly connect your external drive and select Time Machine from System Preferences or Applications. Turn on Time Machine and wait for your computer to finish backing up.
Begin Boot Camp process
1. Open Boot Camp Assistant from the Utilities folder. Follow the onscreen instructions which will prompt you to download Windows Support Software (to your USB) and to install Windows. You will then be asked what size partition you will be dedicating to each "side" of your computer. Remember that 32 bit Windows 7 requires at least 16 GB to install and 64 bit requires at least 20 GB. I personally went with 80 GB for Windows on my 250 GB hard drive as I will be using OS X more frequently.
2. Insert your Windows installation disc and click install.
If you had no problems after this point, you can skip to the "Reformat Windows Partition" section. If you received the following error message, continue reading:
The disk cannot be partitioned because some files cannot be moved. Back up the disk and use disk utility to format it as a single Mac OS Extended (Journaled) volume. Restore your information to the disk and try using Boot Camp Assistant again.
Fixing the error message
1. If you received the error message above, do not fret. It is not as difficult as it seems. There are answers all over the internet for how to fix this but this is what works. You MUST have backed up your computer using Time Machine to continue on from this point.
2. Restart your computer, and upon reboot press COMMAND + R. This will allow you to open Disk Utility, select your computer from the left hand side, select the Erase menu, and Erase your hard drive.
3. After doing so, go back and select to Restore Mac from Time Machine Back Up. Select this option and connect your external hard drive. Your computer will recognize your back up and will begin restoring your computer. This WILL BE a bootable backup, meaning that if you have Mountain Lion installed on your drive before wiping your computer and restoring, you will still have Mountain Lion.
4. After this process is complete and your Mac is up and running again, reopen Boot Camp Assistant and try again. You should have no problems at this point.
The reason that you may have to follow these steps is because you have likely been using your Mac for some time now and have downloaded and saved various items, erased them later, and have randomly scattered open spaces on your hard disks. This means that your hard drive is Fragmented. In order for Boot Camp to run successfully, it needs a significant amount (the size of your desired partition) of continuous open space and with a fragmented drive that is impossible. There are programs such as iDefrag but this DOES NOT WORK to solve your particular problem. The only way to truly defragment your drive is to back up, wipe your drive, and then restore. This gives the necessary amount of open space at the bottom of your hard disks in order for your computer to successfully partition itself.
Reformat Windows Partition
1. After Boot Camp has successfully partitioned your drive and begun installing Windows, you will be given the option of where to put your Windows installation.
2. Of course, you need to select the BOOTCAMP drive. There may be an error message saying that you cannot install to this portion of the hard disk because it is not formatted correctly. However all you need to do is select the option to reformat the boot camp partition, and you will be able to successfully install Windows.
In following these instructions, you will be able to sucessfully partition your drive and run Windows on your Mac.