I have one of those. Still kicking. The highest OS would be Leopard. If you have install DVD for Tiger or Leopard, juts insert it in the disk bay, restart the computer holding C key and follow the instructions. You should choose "erase and install" option. You might like to increase RAM to 2 GB.
I bought it with OS X server 10.2.8 I'm a designer and not too up on tech stuff. How can I erase system and upgrade with standard operating system?