|"....I found it worked fine on another computer.."|
Then there's nothing wrong with it, assuming you haven't damaged the external enclosure since.
"When i plug my external hard drive in with USB, the computer says it would run faster if it were USB 2.0"
That's just a "nag" message. The drive will work fine anyway, but the operating system is not detecting that it's plugged into a USB connection that supports USB 2.0 standards - the max data transfer speed to and from the external hard drive will be lower than it would be if it did. You only get that message for USB devices that "tell" Windows they work better if the USB connection supports USB 2.0 standards (e.g. you don't get it for corded keyboards and mice).
You must have the device plugged into a USB port that supports USB 2.0 standards. All mboards made since about 2004 have USB controllers / all their USB ports that support that ( or that and USB 3.0 standards for recent mboards.)
(Some very early mboards that supported USB 2.0 had some ports that supported USB 2.0 standards, others that supported only USB 1.1 standards.)
The bios Setup of the mboard must have the USB 2.0 controller support enabled. If your mboard supports USB 2.0 standards (or USB 2.0 and USB 3.0 standards), that's enabled in the bios by default.
If you have installed Windows from scratch, the built in USB 2.0 support of Vista or Windows 7 is NOT installed until AFTER the main chipset drivers for the mboard have been installed.
( The same things apply if Windows XP or 2000 is installed on the computer you're getting this message from, AND XP must have SP1 or later Windows updates installed in it, and 2000 must have SP4 or later Windows updates installed in it, in order for it to have the built in support for USB 2.0 controllers and devices.)
You must use a USB cable that supports USB 2.0 standards, if the device requires a cable.
If the USB 2.0 support HAS been installed in Windows, in Device Manager - USB Controllers there will be at least one listing for an Enhanced USB controller or similar (usually there is no 2 or 2.0 in it).
(The other USB controller listings that don't have that are for USB 1.1 support. All USB 2.0 controllers also support USB 1.0 and USB 1.1 devices - the listings are for both types of support. The total number of USB ports availble for Root Hubs supported by the USB 2.0 support, more than three per Root Hub = the total number for Root Hubs supported by USB 1.1 support, usually two, or three or one per Root Hub - they're the same physical ports or USB port mboard header connections.)
If you see that there, yet you're still getting the "the computer says it would run faster if it were USB 2.0" or similar message, you probably need to
- plug the external drive in a different USB port,
- or you need to use a better USB cable between the external enclosure and the computer,
- or you need to use a Y cable with the external hard drive and plug it into TWO USB ports on the computer.
Troubleshooting USB device problems including for flash drives, external drives, memory cards.
See Response 1:
External optical drives also require 500ma from the USB port you plug it into.