I was hoping this would be fixed, but it still seems to be an issue. Parallels uses an exorbitant amount of disk space during running. I have a 768M machine, and 876M set aside for Parallels. For some reason during boot of the virtual machine, Parallels takes up 1.5G of space on my harddrive. O.k., I know it creates some annoying .mem file, but even with the 876M set aside, that is still over 600M that is unaccounted for. My understanding of the .mem file is that it can help restore from a suspended machine. I'm using Parallels off of BootCamp though, and my understanding there was you aren't supposed to suspend a machine anyway in this configuration, so why should it set this 1.5G aside? It delays the start of the virtual machine while it creates this space on disk. This should be an option, which if necessary for some users, should be able to be turned off for others. This problem ends up causing me two main issues: 1. If I'm doing other things on the system before launching Parallels, I get the unable to allocate Virtual Machine memory, even when I have over 2G available. 2. If i've gotten into Parallels, I often get an OSX prompt regarding the lack of space, and I need to kill an application. If I just close the window then it gets very annoying by popping up every couple of seconds. Running: MB Pro - Core Duo 2.16, 2G RAM Parallels 3150, RC2 Hard Drive - 80G Now the 80G drive may seem like a bit, but I have 30G set aside for the Windows partition to run numerous applications out of that. I can't really shrink that partition due what is loaded on that. I have numerous applications loaded into OSX. I do have external drives, but there are several files I need to keep with me, and lugging an extra hard drive everywhere I go is impractical. I move files off the laptop as I can, and am generally able to keep between 2 and 3 gigs free on the drive. This need for 1.5G of that space is abyssimal, as it frequently prevents me from using Parallels, and thus counters the benefits Parallels often provides. I do love Parallels, and have been using it since it's first beta. My drive however isn't as happy with it, and there is little I can do to clear any more space in an ongoing basis. This excessive use of drive space needs to be resolved. Both windows and the Mac have memory management and virtual memory already, so between not being able to suspend a bootcamp, and existing virtual memory management within the host and guest OSs, I have absolutely no idea why Parallels would need to set aside a gig and a half of space.