Having 2 gb of ram would be nice, especially if you're running Vista. You could upgrade that pretty cheap.

Your video card is pretty entry-level, and you could benefit from an upgrade there. The Radeon HD 3850 can be found for about 180 bucks at Newegg.com.

With those two upgrades, you'd easily be running WOW at the highest graphic settings with no problem at all.

Edit: If you have XP, 2gb would be nice but not necessary. If you go to Vista, you should consider 2gb to be theminimum amount.