PCs running Windows 95 or earlier generally used a file system called FAT-16, which gets progressively less efficient, the larger the disk. Newer versions of Windows still support FAT-16, but would normally be installed with FAT-32 or NTFS file systems.
Disk space is divided into clusters, and each file takes up a whole number of clusters. The cluster size varies depending on the size of the disk and the type of file system. It can vary from as low as 512 bytes, to as much as 32 Kbytes (or even more)! For example, if the cluster size is 8 Kbytes, then even a 1 byte file takes up 8 Kbytes of disk space.
This can have a dramatic effect on the amount of disk space used. A folder that contains 1,000 files, each of which is only 1 byte in size, could use up as much as 32 Mbytes if the cluster size is 32 Kbytes, instead of less than 1 Kbytes that might be expected.
The following table shows the cluster sizes for different sized disks formatted with FAT-16.
| Disk size | Cluster size |
| 128 Mbytes | 2,048 bytes |
| 256 Mbytes | 4,096 bytes |
| 512 Mbytes | 8,192 bytes |
| 1 Gbytes | 16,384 bytes |
| 2 Gbytes | 32,768 bytes |
Note: 2 Gbytes is the largest disk size supported by FAT-16.
A PC that came with Windows 95, but was bought after 1996, may have come with a newer version of Windows 95 called OSR 2 (this stands for OEM Service Release). This version of Windows 95 was only available with new PCs, it could not be bought separately. This version of Windows 95 supports the newer file system FAT-32. This has much smaller cluster sizes than FAT-16 on large disks, and also supports larger disks than FAT-16. Windows 98, Windows Millennium, Window 2000 and Windows XP all also support FAT-32.
If you have a version of Windows 95 that does not supports FAT-32, or if you want to carry on using FAT-16 for some other reason, then one solution is to use smaller partition sizes. The table above simplifies things a little, since it assumes that a disk has only one file system filling the whole disk. However, a disk can be divided into sections called partitions, each of which has a separate file system in it. As you can see from the table above, the smaller the partition size, the smaller the cluster size. Dividing a 2 Gbyte disk into four 512 Mbyte partitions will generally allow more data to be stored on the disk, although you will have the disadvantage that is has to be spread over four partitions. These would appear as four drive letters, such as C:, D:, E: and F:.
If you are using Windows 95, then another thing you can do to get more capacity from your disk is to enable compression. See the Windows Help article referred to in this section for more information.