have downloaded the desktop version of ubuntu which doesn't have an option for USB installation. It says DVD drive is missing. I thought this was supposed to be installable to a USB drive.
if you've installed it from ubuntu's official site you should be able to create Live USB via Universal Usb Installer (UUI). For further support take a look at UUI Site
since you haven't said which OS you're using, i assume you're using windows
I'm a little confused on where you are with the Ubuntu installation process. If you want to install Ubuntu from a USB drive, you will need to use a software program to "burn" the .iso. disc image file to the USB drive of your choice. From there, you need to boot your computer from the USB drive.
If you're currently running Windows, try using Linux Live USB Creator to burn the disc image to a thumb drive.