Apple released Lion Recovery Disk Assistant Monday, a free download that allows users to create a Lion Recovery volume on an external drive. This allows users to use that drive to reinstall Mac OS X on a Mac, run Disk Utility for disk repairs, or restore from a Time Machine Backup.

To use Lion Recovery Disk Assistant to create this external drive (be it a hard drive or thumb drive), users must run it on a Mac that has an existing Recovery partition on it. This is an invisible partition created when you first install Lion.

Once created, the external Recovery HD partition doesn’t include a full install of Lion, but if you need to reinstall it starts the process, allows you to give it your Mac App Store (iTunes) credentials, and handles the download and installation process.

According to Apple, “When the Lion Recovery Disk Assistant completes, the new partition will not be visible in the Finder or Disk Utility. To access Lion Recovery, reboot the computer while holding the Option key. Select Recovery HD from the Startup Manager.”

Note that the creation process will erase your external drive, so take appropriate precautions with any data you may have on that drive.

Lion Recovery Disk Assistant is a free download.