Is it a good idea to create a "soft link" from iTunes Library to an external hard drive to release hard drive space? My iMac has a 1TB internal hard drive, and 300GB is allocated for Windows 7 using BootCamp.

Of the 700GB, right now the space remaining is only about 20GB, and I do hope to create a new partition and install Mountain Lion on it (or install Lion on it and upgrade the current Lion partition to Mountain Lion).

Since the majority of hard drive space use is:

/Users/mike/Music/iTunes/iTunes Media/iTunes U        270GB
/Users/mike/Music/iTunes/iTunes Media/Movies           70GB


and since Mac OS X is UNIX and can create a "soft link", how about creating a soft link (using the Terminal app) using:

ln -s "/Volumes/My Passport/Movies" "/Users/mike/Music/iTunes/iTunes Media/Movies"


and the same for "iTunes U", so that two soft links are created, and they point to the external hard drive ("My Passport", which is a WD 1TB drive).

I probably will do it by rebooting the system, move the Movies folder from the internal drive to the external drive by Finder, using drag and drop, and then create the soft link, and then do the same for "iTunes U", and then create the 2 soft links, and start up the iTunes app and see.  

Is this actually a good practical solution by creating a soft link like that?  In a way it is like fooling the system to go to the external drive and can there be any side effect?
It's a better idea to copy the iTunes Media folder to your external hard drive, then go to iTunes Preferences > Advanced tab and change the iTunes Media folder location to the one on your external disk.

You can also move the library file itself (in ~/Music/iTunes/ on my system), but I don't recommend doing both at the same time. There're other questions around here that go about explaining how to use a different library location.

To more-directly answer your question, I don't know of any downsides to using symlinks, but that's because I've never done it. I have done the approach I described here and it's generally better to avoid going behind an app's back if you can.