Backing up external hard drive to time capsule?

Hello,

I have a 13-inch MacBook Pro and am quickly running out of space on my internal HD. I currently back up my computer regularly to a simple usb-connected external hard drive (MyPassport; 500 gb). I would love suggestions for externally expanding my memory and for backing up both what is on my internal and external hard drive. I was thinking I could use my 500 gb external hard drive currently working with Time Machine as my place to store more things (thus I would erase all the backups on that disk and use it for more storage of new things) and get a new hard drive to back up my computer and external hard drive. I was thinking of getting a Time Capsule for this (to backup both my computer and an external hard drive). Can this be done? Can I back up both an external hard drive and my computer to a Time Capsule, and if so would I have to plug the external hard drive directly into the capsule, or how would I back up the external hard drive to the Time Capsule? Because I can not use a Time Capsule as a place to store new material and a place to backup that new material and my computer, I would appreciate any suggestions for expanding my storage and backing up that expansion and my internal hard drive.

Thanks in advance!