Error in MySQL syntax during installation

I’m getting this error during the installation process.
[I]
“You have an error in your SQL syntax; check the manual that corresponds to your MySQL server version for the right syntax to use near ‘SCHEMA CHARACTER SET utf8 COLLATE utf8_general_ci’ at line 1”[/I]

Is the problem the MySQL version? I’m using 4.1. Should I be using 5?

Thanks in advance

Yes, Oxid need MySQL 5.0.33 or higher

http://www.oxid-esales.com/en/products/community-edition/system-requirements
http://www.oxid-esales.com/en/produkte/community-edition/systemvoraussetzungen (german)

Kind regards,
Carolin