You cannot format the system disk while windows is running.
for other disks, open disk management (control panel -> administrative tools -> computer management ->disk management), right click the disk you want to format, and choose format. It will then allow you to select full or quick. Bear in mind that a full format of a hard disk or a large USB stick will take a VERY long time (hours or even days).
formatting the system disk has to be done either from a live cd or windows setup. In windows setup, proceed through until it asks you whether you want to upgrade or custom install, and choose custom. On the next screen it will show your disks, select the one in question and then click the small 'drive options (advanced)' link in the lower right hand corner of the dialogue. This will give you the format option among others.