This tutorial will teach you how to get a USB ATA 2.5" to work with the PS3.
That's an example of a 2.5" ATA External USB HDD.
Note: This only works with Linux.
What you need to do:
If your HDD is already FAT32 Formatted skip to step 3.
1) Install Linux software on your PS3 (Tested with Ubuntu 7.10)
2) Once you have installed Linux on your PS3 you must connect the USB 2.5" External HDD to your PC and format it with SwissKnife (http://www.download.com/CompuApps-SwissKnife-V3/3000-2248_4-10070864.html?hhTest=1&tag=lst-2).
Note: When you have connected the HDD to your PC you must do this:
a) Go to START > CONTROL PANEL > ADMINISTRATIVE TOOLS > COMPUTER MANAGEMENT
b) Select DISK MANAGER on the left hand side options.
c) Select the external drive and read the "File System" type. If it says "NTFS", right click the disk and select "Delete Partition"."
Then with SwissKnife do this:
"Run the application and select the external hard drive you need to partition.
On the top select the following settings: (Partition Type: Primary), (File System: FAT32), and (Volume Label: [whatever you want]).
At the bottom, select "Create" and you're done."
3) Once you have done that, put any test file on your HDD such as a picture or a song. Then run Linux connect the 2.5" ATA External USB HDD to your PS3 and voila.. it should detect it automatically and you should be able to see the files on your HDD via PS3 Linux.
I have only tested this on Ubuntu 7.10 Linux, it may work on other Linux operating systems on the PS3.