System restore helps recover from system crashes and new software/malware installations that lock your computer. It provides a way to restore the system/program files, as well as Registry settings to a previous state. It will not touch your documents, emails, or other personal files. The System Restore feature in Windows can be very useful, however, over time disk usage can get out of hand and should be managed.
Under Windows 7 and later, the size of System Restore can be managed as follows:
1. From the Start menu (or desktop), right-click on the Computer icon -> choose Properties -> click the "System protection" link in the left pane. Alternatively, you can find "System Protection under: Control Panel -> System and Maintenance -> System
2. In the "System Protection" tab that opens, click the "Configure" button to find a "Max usage slider. This can be adjusted down to 1-2% of your drive, or as much as needed for storing a couple of restore points.
In most cases, it is useful to leave System Restore turned on, as it can help in recovering from faulty software installations and OS locks. However, the default size takes considerable amount of space, and should usually be adjusted down to 1-4GB.
Notes:
Under Vista, the size of the System Restore disk can only be managed using a command-line utility called vssadmin. See this FAQ for details.
