Click on this iPod icon. Information about the device will pop up in the center pane, including how much data is used and what version of the iPod firmware is installed.
Click the "Restore" button at the bottom of the center pane (under the picture of the iPod.) You will then be prompted to choose whether to restore the original firmware on your device or the latest version from Apple.
Wait for your iPod to reset. A status bar will pop up in iTunes, and your iPod will display a "Do not disconnect" message. It is very important not to attempt to unplug or operate your iPod while it is being cleared. When the new software is installed, an Apple logo will pop up, followed by the familiar iPod menu.
Although your iPod may hold a lot of media, sometimes you may feel the need to start with a clean slate. Whether you're trying to reorganize your media collection or troubleshoot your device, clearing your iPod of any content is fairly simple. To completely wipe the iPod, you'll have to perform what is known as a "factory reset." This basically means that your iPod will restore itself to the condition it was in when you bought it.
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