I am not totally sure about this, but its worth a shot. Check your IRQ's I don't know if the mouse uses an IRQ or it uses one with USB, but its worth a shot. Another thing is to get the most updated drivers for your mouse, check to see if its plugged in correctly. Try another mouse and see if you get the same results, if you do then its most likely not your mouse and could be an incompatibility with XP. TRy using your mouse soft in Compat mode.
You could also try installing your mouse drivers manually! that might help. BUt with the limited information available, I simply cannot offer a definitive answer or suggestion.

YOu might want to include this information

What kind of mouse?
What version of XP?
What software you have installed
What software is running in the background
Post a screenshot of the behavior
Post any errors you are receiving, if any..
and any other information you consider that might help in this situation.
Thanks
BB