Windows XP not Recognizing new RAM.

I upgraded the RAM in my Sony notebook (model FRV26), from 512 MB to 1 gig.
The computer originally had 2 X 256mb PC2100 266MHz DDR. It now has 2 X 512mb PC2700 333MHz DDR.
The computer still claims it only has 512mb of RAM. Both of the sticks are good, but when I start it with each individually, it claims to only have 256mb. I know the new RAM is faster than what the motherboard requires, but I thought it was backwards compatible and therefore didn’t matter. Could that be the problem?
Any other advice?
Thanks in advance!