Notice for pfSense 2.1+ users: These steps are no longer required with pfSense 2.1. PfSense 2.1 and onwards will be able to boot from an USB disk with just installing it using now option #3 from the first menu which dictates to boot using an USB device. From there on, the installation will take care that the booting from the USB disk can be done without having to change the boot loader yourself.
It is possible to install pfSense on
an USB disk. I'm using an 2,5 inch USB boot disk in my pfSense firewall because
its very energy efficient compared to a normal SATA disk. In order to install
and run pfSense from an USB disk, follow these steps: