Contributed By: Cliff Hobbs [MVP SMS]
Well it depends on several factors such as the size of your environment, what other services/ applications are running on the server you are planning to use for SUS etc.

Microsoft recommend (as would I), that wherever possible you run SUS on a dedicated server (not a Domain Controller), to eliminate potential problems such as application compatibility, performance, etc. Microsoft have tested the following applications as being able to co-exist on the same server as SUS:

• FrontPage Server Extensions
• SharePoint Team Services
• ASP.NET applications

If you’re planning on using SUS on a server that uses a different set of applications it’s strongly recommended you try this in a lab environment first. Applications to really watch out for are those running under IIS that rely on IIS being installed and configured one way only for SUS to come along and change something (the URL Scanner springs to mind). To help you with this read Appendix A "Understanding Security and Software Update Services Setup" of the SUS Deployment White Paper:

http://www.microsoft.com/windows2000/windowsupdate/sus/susdeployment.asp