Yes, you have 2 options. You can either perform an in-place upgrade or a side-by-side upgrade.
You can find more information on how to perform the upgrade here:
http://www.microsoft.com/technet/prodtechnol/sql/2005/msde2sqlexpress.mspx#ECHAC
Whichever method you choose, we strongly recommend that you perform a backup of your databases before performing the upgrade.