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I have MacBook Pro (late 2007) which I planning to sell. Currently it's running Lion. Is it possible to clean all data but leave Lion?

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Yes, Just hold down cmd+R during startup and Lion Recovery springs into action; It lets you choose from common utilities: You can choose to erase your hard drive and reinstall a fresh copy of Lion.

P.S: In order to reinstall OS X Lion, you will need to be connected to an Ethernet or Wi-Fi network

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Note that you need to choose disk utility and erase the disc, not just "reinstall lion", which will try to fix a broken system but leave your files intact. – rjmunro Aug 27 '12 at 23:40

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