yes you can do it!
1.get a microphone
2.download speech recognition form Microsoft or other company.
3.go to control panel >speech>speech recognition.
4.make sure you have the latest version
5.region and languages at control panel than click languages at the tabs than detail than advance than click the first box from the top.
6.restart your computer.
7.enjoy

That feature is also included in Windows Vista (without downloading anything), but both Windows XP and Windows Vista speech recognition system are a bit inaccurate sometimes. These need some time of training if you want to write a document only using your voice, for example.