this is quite a tricky problem to tackle..
i suggest the following steps
1. Check if your laptop is still covered by Toshiba warranty Global Entitlement
if the laptop is still within Toshiba warranty, its best to go into safe mode, copy your files to an external hard drive, and bring the laptop to an authorized service center. The authorized Toshiba techs would be best to check each component inside your laptop for possible problems that cause the hang and distorted image.
2. If in case your laptop is no longer in warranty, still do a backup of your files into an external hard drive. this keeps your files safe on another disk while we try troubleshooting methods on your laptop.
3. was there any software or setting that you had uninstalled/installed OR changed before the problems appeared? if there are, try to undo those settings.
If you are able to go into the normal boot of Windows XP (not safe mode) and the screen colors and icons are distorted, lets try adjusting your monitor resolution
Click on the Windows Start button
Click Control Panel
On the Settings tab, set the resolution to the maximum, and set the color quality to 32 bits.
if those settings are not available, then chances are that your laptop's video card driver has been uninstalled/damaged or modified incorrectly. Proceed to step 5.
5. Go to the Toshiba laptop page -- Toshiba Support - Homepage
Click on Downloads
Then select your laptop's model Family and model number.
Locate the download for your Video card/ Display Adapter
Download and install it.
Again, if your laptop is still within the Toshiba warranty, its best to send the machine to the authorized Toshiba service provider.
if the laptop is no longer in warranty and you want to try the basic troubleshooting steps i mentioned above, remember its best to keep a backup of your files to an external hard disk or flash drive.
Feel free to post any updates and we'll continue to help with more advanced troubleshooting steps on this