Can I install Mac OSX Sierra on USB drive? I have an early 2011 MacBook Pro. I want to try Sierra as most of the software I want to use no longer works on Mavericks. I went through a number of post that I can install Sierra on 8 GB USB drive but that turned out only to be a macOS installer thumb drive.

I am interested in installing Sierra on USB drive just to test drive it and to run my favorite software. I bought 16 GB USB for that purpose but only found out it cannot be installed there for lack of space.

Can somebody guide me, can I have Sierra USB Image that I can load on USB and test drive it or can I install it on USB and run Sierra from it whenever I want it.
You certainly can install macOS Sierra to a USB device. I would advise you use USB 3 or 3.1 in order to ensure a smoother experience while booted from this device.

First of all, use the Mac App Store installer for macOS Sierra, which you can get here: get macOS Sierra. Learn more about obtaining macOS Sierra here: How to download macOS Sierra

Next, it's best to format your USB device as Mac OS Extended (Journaled). With Scheme as : GUID Partition Once you do this, open the macOS Sierra installer. When you are prompted to choose an install destination, make sure to choose your USB device.