| Full Install of Ubuntu 14.04 LTS on USB Stick
Assuming the system on which you would be doing this is booting in legacy (MBR) mode, not UEFI mode, these are the installation steps for Ubuntu 14.04 LTS:
Boot from a live DVD/USB
On partition selection stage, choose "Something Else.."
Create/Select partition(s) on your target USB drive as mount point for root (/)
Make sure the target for Grub is also the same USB drive, not a 'Partition' or another drive (e.g. /dev/sdc or /dev/sdd etc., NOT /dev/sdc1 or /dev/sdd1..)
Install normally and finish.