Any distribution will run fine on your system, although you may have to change the desktop environment used. Most popular distributions come with Gnome or KDE, which, although they will run, will perform quite sluggishly. You can replace them with a lighter desktop/window manager like XFCE, IceWM to get better speed.
Vector Linux is a great distribution which will run like a breeze on your system, out of the box. It comes with XFCE and other window managers, and is optimised for older PC's.
By the way, there have been many other discussions on the same topic earlier, search this forum and you will find a lot of information.