The answer to your question is "kinda".
You will need to buy the camera connection kit (CCK). You can then connect a usb drive through the CCK to the iPad. However, the CCK was only designed for interfacing with a camera so in order to connect an external drive you must trick the iPad into thinking it is a camera. This is done by creating a DCIM folder in the root of the external drive and then place any photos or videos in that folder.
Other restrictions:
-Drive must be self-powered or draw very little power (like a thumb drive). The iPad will not power something like a wd passport because it requires too much energy.
-Drive must be fat/fat32.
-Can only transfer photos and videos... all other files will be ignored.
-Cannot stream videos. If you want to watch a video from an external device it must be imported to the iPad.
If you really want to get around those restrictions you can jailbreak your iPad. Search the forum for information about jailbreaking.
Hope that answered your question.