You have 1 PCI-Express x 16 slot available, since you're currently using Geforce 6 series integrated graphics.
Getting a better power supply will depend on what video card you choose. If you choose a video card that has a connector for hooking up an external power source, you will need a better power supply as the one that's currently in your system is sub-par.
I would recommend getting a 550 watt PSU with a mid range graphics card, something like a 5750, maybe a 5770 if you want. A GTS 250 would be good too. (This of course depends on the resolution you're playing games at, what detail settings, etc)
Also to note, with an upgraded video card, your CPU might then become your slowest component.
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