HDD Utility Disc is software to format a hard disk drive for use in a PlayStation 2 console, in conjunction with Network Adapter. It works with only the official PlayStation 2 HDD unit. It’s main feature is to allow creation of folders on the HDD to store game save files. If a folder named “Your Saves” is present on the HDD, games that support saving to the HDD and loading from it will use that folder. If that folder doesn’t exist, the games will create it when attempting to save to the HDD.
The only other feature of HDD Utility Disc is enabling launching of games installed to the HDD, though it can only do so if the game supports launching from the HDD, and most games that install to the HDD require being launched from the original disc as an anti-piracy measure.