entity declaration error

I am trying to add an entity in my XSL, but I keep getting the following
error when I add the doctype line in the code below:

---------------------------

ERROR:
msxml4.dll error '80004005' 

The stylesheet does not contain a document element. The stylesheet may
be empty, or it may not be a well-formed XML document.

---------------------------
CODE:

<?xml version="1.0" encoding="utf-8"?>
<!DOCTYPE xsl:stylesheet [ <!ENTITY nbsp "&#160;"> ]>
<xsl:stylesheet xmlns="http://www.w3.org/1999/XSL/Transform"
version="1.0">

---------------------------

why am I getting this error? When I take out the doctype line my page
works fine.
Thanks-
 Mac





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