That happens because the BIOS uses a SATA controller that is not included in Windows XP install disk.
Usually you can solve the problem going to BIOS settings and changing SATA/RAID settings.Check your BIOS settings, and disable SATA RAID mode.This is done in different ways depending on the BIOS.
On HP/Compaq computers for example you press F2 on startup to enter BIOS, then disable SATA mode on bios settings.
On other makes the procedure can be slightly different.
Another way to fix the problem, is by creating your own XP setup disk with SATA drivers included, see: Resolving "Setup did not find any hard disk drives" during Windows .
I can only comment on the Compaq CQ70-116ea laptop which I have just "downgraded/upgraded/sidegraded" to XP Pro, but the BIOS does not allow for setting to be amended beyond Date/Time, boot devices & boot order and Admin password setting.
I borrowed an external USB FDD from a mate and had the ICH9M-E/M SATA drivers on a floppy, hit F6 during XP setup to add extra device drivers and it worked fine. XP Pro, so I understand, doesn't included by default any drivers for SATA devices - mainly because SATA devices came after XP did...
I also tried to option of creating a bespoke XP Pro installation CD with the SATA drivers included, but the installation BSOD every time - but that could well be my fault rather than anythign else!