Windows allocates 15 percent of your hard disk space for system restore. The slider bar which used to be there in Windows XP has been removed in Vista.You need to do some work with your command prompt for doing this now.
To change windows vista disk space usage, login as administrator and launch command line, and run
vssadmin list shadowstorage to see the current allocation.
To change it, use:
vssadmin resize shadowstorage /on=[drive]: /for=[drive]:
That is, to limit System Restore to 'n' gigabytes on the C: drive, use:
vssadmin resize shadowstorage /on=C: /for=C: /maxsize=nGB
Of course, limiting System Restore's drive footprint also limits how far back it can store points.If you put very less space,Just keep a eye on your restore points regularly.
originally taken from Life Hacker