Microsoft Knowledge Base Article 317586 contains the following summary:

This step-by-step article describes how to optimize Indexing service performance on a Microsoft Windows 2000-based computer.

Indexing service performance depends on several factors including the number and size of documents that are indexed, the rate at which queries are submitted, and the complexity of the queries. Performance is also affected by the amount of computer resources that are available to the Indexing service. A computer with the minimum hardware configuration for Windows 2000 can process queries efficiently if the number of simultaneous queries is not too high. For a larger organization that serves many users and with a large number of documents to be indexed, a more powerful configuration may be required. For example, performance can be improved by adding more memory. To optimize performance, you can also tune Indexing service performance based on its usage requirements.

You can optimize Indexing service performance based on how often the service is used. You do this by specifying a pre-defined or custom Indexing service usage option. Each usage option defines different performance settings for the indexing and querying processes. These settings determine the amount of computer resources that are devoted to each process.

The performance settings that are available for indexing are:

Lazy: Use this setting for less immediate indexing of new and modified documents. The amount of system resources that is reserved by the Indexing service for indexing is minimized.
Moderate (not labeled): This is the default setting.
Instant: Use this setting for immediate indexing of new and modified documents. Additional system resources are reserved by the Indexing service for indexing.

The performance settings that are available for querying are:

Low Load: Use this setting if only a few queries are expected to be processed at any one time. The amount of system resources that are reserved by the Indexing service for querying is minimized.
Moderate (not labeled): This is the default setting.
High Load: Use this setting if a larger-than-usual number of queries is expected to be processed at any one time. Additional system resources are reserved by the Indexing Service for querying.

You specify the performance settings that you want by using one of the following pre-defined or custom Indexing service usage options:

Dedicated Server : Use this option if you want to dedicate the computer to run only the Indexing service. This option uses "Instant" indexing and "Heavy Load" querying performance levels.
Used often, but not dedicated to this service: Use this option to specify that Indexing Service is used often enough on this computer to require better than average performance. This option uses "Lazy" indexing and "Moderate Load" querying performance levels.
Used occasionally: Use this option to specify that the Indexing service is not used often enough to require better-than-average performance. This option uses "Lazy" indexing and "Low Load" querying performance levels.
Never used : Use this option if you do not want to use the Indexing service on the computer. The service is turned off.
Customize : Use this option to define custom indexing and querying performance settings.