Access iTunes library from External drive after OS upgrade

Question

Because of its size I have recently kept my iTunes library in the 'Media Library' on an external hard drive and accessed content from there without any problem. After upgrading to OS 10 Lion, iTunes has created a new library on my internal hard drive. Now I'm trying to re-access the old library on my external hard drive.
I have tried two things so far:
- Gone into the iTunes Advanced Preferences and changed the Media folder location to my external hard drive location. That didn't work.
- When I open iTunes holding the option key (as was suggested here) I am given the option of choosing a different library. But when I click on the iTunes folder in MediaLibrary I get the following message:
An iTunes library file could not be found in the folder "iTunes". Please choose a different folder.
All the content is there on the external drive but I'm assuming there are some .itl or /xml files missing. (I can see those as part of the new iTunes folder on the internal drive.) I have a floder named Previous iTunes Libraries on the external drive which contains some files with dates in them, two of which have the extension: .itl
Should I perhaps move those files somewhere...?
Any help is appreciated!!!
Hans

Answer 1

Hello there FunkyMuzak,
iTunes can be set to use the library on the external drive, and save new content.
To have iTunes open the alternate library on the drive use this option:
Steps to create or choose a different iTunes Library file
If iTunes is running, quit iTunes.
If you are using Windows, hold down the Shift key and from the Start menu and choose All Programs > iTunes > iTunes.
If you are using the Mac, open iTunes and immediately hold down the Option key.
You should see one of the following screens:
From: iTunes: How to open an alternate iTunes Library file or create a new one
          http://support.apple.com/kb/ht1589
And to tell iTunes to save your new media when you buy songs or movies, etc., use this part of our article named Where are my iTunes files located? found here http://support.apple.com/kb/ht1391
Discovering and changing the iTunes Media folder location
Note: You would usually only change the iTunes Media folder location to share music between accounts on the same computer. See this article for specific steps on how to accomplish this. Also, see this article if you want to know how to move your music to a new computer.
Mac OS X: Click the iTunes menu and choose Preferences.
Windows: Click the Edit menu and choose Preferences.
Click the Advanced pane. iTunes displays the location of your iTunes Media folder.
You can then:
Note where your media folder is, such as for backing up your media.
Use the Reset button to reset it's location to the default (which is the iTunes folder).
Click the Change button to select a folder for a new location. Once you change this location:
If you make a new or alternate iTunes library, the new location will be used by that library.
Existing files will not be moved unless you choose File > Library > Organize library and choose the option to "Consolidate files."
Cheers,
Sterling