We usually refer to "Unallocated space" as a part of a disk without any filesystem. So, technically, no, you can't install Ubuntu in an unallocated space.
But Ubuntu's installer (called Ubiquity) has a step which lets you partition/organize/format your disk. In Linux, drives, disks and partitions are not named with letters (unlike Windows), but with kernel-created special device files, inside the /dev
directory. The first, main hard disk of a computer is usually represented by a file named sda
. Its partitions are represented with the same name, but with numbers. For example, the first partition of the first hard disk is named sda1
.
When you run Ubuntu's installer you'll need to format the partition where you want to install Ubuntu as ext4. Ext4 is the default filesystem for Ubuntu and most GNU/Linux systems, just like NTFS is Windows' and HFS+ is OSX's. You'll also need to set the filesystem's root's mountpoint to be in that partition.
If you choose "Erase disk and install Ubuntu" or "Install Ubuntu alongside Windows" everything will be done automatically, but you won't be able to choose how much space will be allocated to each system: it will be 50-50.
If you choose "Something else..." you'll be able to make your own partitions (including separate ones for /home, /var, /boot or any other directory), but have in mind that this is an option recommended for advanced users.