Windows XP won’t recognize hard drive, but I can run diagnostics on it?

I have a p/c that bluescreened on a user. Apparently, ntdll.dll was corrupt. I try to boot from an XP installation CD but XP setup indicates it can’t find a hard disk. I can run diagnostics on the drive and nothing shows wrong. I have been able to hook the drive to a USB port, and can see everything on the drive. I even backed it up before trying to reinstall XP. Anyone ever seen this before?