Disable the Guest Account

Yes you can disable the guest account, but you shouldn't. You need it. The Guest account in Windows XP Home Edition and Windows XP Professional (when not joined on a domain) serves several special functions that relate to security and network shares. Because of its importance, you must not disable the Guest account. If you disable the Guest account, your network can have problems that include malfunctioned shares.

Note: You might also be interested in Disable the Guest account in Windows 2000.
To hide the guest account - On a Windows XP Home computer, or on a Windows XP Professional computer that is not a part of a domain do the following:
1. Click Start, and then click Control Panel.
2. Click User Accounts.
3. Under or pick an account to change, click Guest.
On the What do you want to change about the guest account page, click Turn off the guest account.
The Windows XP Guest account is used in the Windows XP Home Edition and in Windows XP Professional when it is not a domain member. Windows XP - particularly XP Home - uses the Guest Account in an unexpected way. Everybody who gets onto a networked XP Home computer is automatically authenticated as a "Guest". Doesn't matter who they are, or what kind of privileges they have on their home computer, if they're connected to an XP computer, they're a Guest. If you're using your XP computer in a Domain environment, you'd expect that turning off the Guest account on your computer will restrict access to that PC, right? With the Guest Account turned off, the theory goes, only people who are authorized to use your machine will be able to get onto it. Correct? Unfortunately, in XP it doesn't work that way.
Presumably, if you turn off the Guest Account, and force all users to log on with passwords (go to Start > Control Panel > User Accounts > pick the account > Create a password), only people who have a user names and a password will be able to get on the computer. Right?

To disable the guest account - On a Windows XP Home computer, or on a Windows XP Professional computer that is not a part of a domain do the following:
1. Right-click My Computer, and then click Manage.
2. Click Local Users and Groups.
3. Click Users.
4. Right-click the Guest account, choose Properties.

On the General tab, select Account is Disabled.
In Windows XP Home you'll need to use the NET USER command from the command prompt because the Local Users and Groups is not easily available. To do so open a Command Prompt by running CMD.EXE.
Use the following syntax:
net user username /active:no