Couple things here.
1 - You need space on your hard drive to accomplish these tasks. By using GParted on a LiveCD, you'll be able to shrink your current Ubuntu partition down to accommodate space for Windows 7.
2 - When you install Windows 7, I'm willing to bet my car Windows will screw up the GRUB boot loader, which is required for the dual boot system. Don't panic.
http://ubuntuforums.org/showthread.php?t=224351
Installing 7 will essentially overwrite GRUB and the Windows boot loader will take over. By redoing GRUB afterwards, it counteracts what Windows did during the install. Make sense?
3 - Do yourself a favor and be smart before doing any system critical changes like this. Back your stuff up. All of it.
For future reference - Whenever I set up a dual boot system, I do Windows first, then Ubuntu. This allows me to install Windows, then Ubuntu (with GRUB) and GRUB would automatically overwrite the Windows bootloader from the get-go so I wouldn't have to worry about anything.
Am I saying reinstall Ubuntu? No. But for future reference if you get a brand new PC with nothing on it, try installing 7 first, then Ubuntu. Just a little word of advice from a Vista/Ubuntu dual booter.