How do I install windows 7 from a USB on start up?

I hold alt when I hear the start up sound and select the usb. As soon as I hit enter, the cursor freezes and it remains on this screen for a long time. Is there a way around this?
I tried to install it through bootcamp assistant, but it doesn't give me the option to install it, only partition the drive.
Sorry about the photo being upside down. I couldn't do anything about it.

Will the option appear if I put a windows 7 installation disc into the dvd drive?
I followed these steps that would allow me to boot from a USB with my version, so I do see the option there.. is it still not possible?
Lior’s solution to no-bootup option for your USB drive Windows installation disk in Bootcamp Assistant (thanks Lior!):
If you have only 2 options in the boot camp assistant, or if bootcamp doesn’t recognize the windows installer disk when its on a bootable usb, it’s because bootcamp doesn’t recognize your macbook as a model that should install windows from a USB, its actually quite easy to fix, just follow these simple steps:
1. go to Applications>Utilities> right click on boot camp and click Show Package Conents, you’ll find a folder inside called Contents (If i remember correctly, not on my Macbook atm). Inside that folder exists a file called info.plist.
2. Right click on the folder containing the file > get info > change permissions so any user can read & write. Do the same for the file itself (right click > get info…).
3. Right click on info.plist and choose Open with > Text Edit.
4. at the end of the document theres a list of strings that contain different versions of Mac computers, the list is titled something like: “USB boot Versions”, add your Mac’s version to the string list ( MB40 ) if your version is Macbook 4,1 (you can see this by clicking on the System information App in the Utilities folder).
5. save the file and change back the permissions on the file and folder.
Now open boot camp and you should see the option to create a Windows 7 installler on a USB, and also bootcamp will look for a windows installation on any USB’s after you partition the hard drive.

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