I'm trying to copy a 40GB folder containing mostly screenshots to a 128GB USB drive formatted as FAT32. The transfer consistently fails about halfway through, when one screenshot folder reaches roughly 2GB, with error 0x80070052: "The directory or file cannot be created." I thought FAT32's main size restriction was that individual files cannot exceed 4GB, not that a folder of many smaller files would be limited to 2GB. The folder is already inside several subfolders rather than directly in the drive's root. Could this be caused by drive corruption, a faulty or counterfeit USB drive, or some other FAT32 limitation? Would reformatting the drive as exFAT be a better option?
2 Answers
FAT32 does not normally impose a 2GB limit on a directory full of small files. Since the failure happens at about the same total amount of data, the USB drive itself may be faulty, corrupted, or counterfeit with less real capacity than advertised. Try another drive first, and test this one with a capacity-checking utility such as H2testw. Also, because the computer froze during an earlier transfer, run the drive's error-checking tool again before trusting it.
Formatting the drive as exFAT is probably the best choice if you don't need compatibility with very old devices. exFAT removes FAT32's 4GB-per-file limit and is supported by current Windows, macOS, and Linux systems. Reformatting will erase the drive, so copy anything important elsewhere first. If the transfer still fails at a repeatable capacity after formatting, that points to a failing or fake drive rather than a filesystem limit.
The drive's properties show FAT32, but the Windows formatting dialog mentions exFAT, which made the filesystem situation confusing. I'll verify the format and back up the data before trying exFAT.

The laptop did freeze during an earlier copy, and Windows reported that it had repaired the drive afterward. I'll test the USB drive properly rather than assuming the repair solved everything.