Using External Monitor. Want Mouse to move Up/Down, not Left/Right?
You don't need to worry about Spaces for this.  What you need to do is go into:

System Preferences --> Displays --> Arrangement

Drag the icon representing your external monitor to the top of the icon representing your macbook monitor:



You can also drag the bar representing your menubar/dock to whichever monitor you want to be your "main" display.