A few days ago, I decided to pull the trigger and install Windows on my Retina MacBook Pro at a LAN Party. It’s a perfectly fine machine with a decent graphics card and CPU. I started Boot Camp Assistant and followed through with the instructions to install from the USB drive using the ISO of Windows 7 I had on my Desktop. If you follow Apple’s steps to the letter, your installation of Windows will never proceed.

If you do follow the steps, you will most certainly get an error of “Setup was unable to create a new system partition or locate an existing system partition. " when you select the BootCamp partition that you had just formatted in the Windows installer on your Mac. This can occur on PCs too but basically the issue is that the USB drive is initialized as another valid bootable disk. If you were to Google this, you will find solutions online that involve yanking out the USB drive and reinserting it before pressing “Install Now” on the Windows 7 installation screen. This “Install Now” screen is a big centered button that prompts your to install now and the arrow is set inside a blue circle that’s like a gem.

This is where Apple’s helpfulness can get in your way. By default, Boot Camp Assistant copies the Boot Camp support files to your USB drive. It also adds an Autounattend.xml file to the root of your drive to automatically install Boot Camp support drivers and utilities in Windows. With Autounattend.xml present, you will not have the opportunity to yank out and reinsert the USB drive before continuing. Instead, the setup just proceeds as if that button was pressed. While this is a good file for disc installations, it causes a massive problem for USB installation which is most likely to be the case for all new Macs from now on since they do not include disc drives by default. If you try to ask Apple to ‘fix’ this, they will just blame Microsoft which admittedly isn’t blame free either.

To solve this problem, move or delete Autounattend.xml on the root of the USB drive and proceed with the normal steps afterwards . After Windows is done installing and since Autounattend.xml was nullified, you will have to run the Boot Camp support installer from the BootCamp folder on the USB drive.

It’s a shame Apple’s instructions just do not work. The fix required would probably mean removing Autounattend.xml functionality for USB Drive installations. In the meantime, this worked for me.