I'm assuming your 1TB drive is an internal drive.
If so, you need to be backing up to an external drive. If you backup to a partition on your internal drive you lose everything if the drive goes walkabout.
As Burdus says, you can't backup to a partition that is smaller than your system drive so you would need to either reduce your system drive to the same size as your backup partition or increase the size of your backup partition to that of your system drive.
If I were in your position, I'd keep things nice and simple in that I'd buy a 500GB external drive and backup to that. It can be disconnected when you're done and will then be protected from any virus infection.
This tutorial should help:
Backup Complete Computer - Create an Image Backup