My 40GB System Partition is full. But it should only contain about 12GB of data.

Have you searched your entire partition for 'hidden and system' files - in all profiles?

If would help if you tell us more about the functions/applications (if any) that run on that server.
You could also do a search for all large files anywhere on the partition.
Some AV programs will stack up all of the old DAT files - which can take up a lot of space.

Of course, all of the 'temp' files can be deleted.

Yes, the largest file is Program Files with 13GB. at most i shouldn't have more that about 20Gig or so used.

I am running MS 2003 Server with Exchange 2003. (the exchange database is on another partition). SQL Server, (Databases on a seperate partition) I am also running Symantec AV Corporate edition. I will see if i can find the old definition files.

Thier is a folder in C:\Windows\Driver Cache that is 111MB. Is that something that can be move or deleted?

I don't have any .dmp files. I do have about 75mb in the C:\windows\system32\spool.
I have drivers, printers and prtprocs. Drivers and prtprocs are shared. prtproces has less than 1mb in it.

How big is your Window directory? One of my domain controllers Windows directory is 3.71GB.

How big is the Documents and Setttings folder?

Windows 3.2 GB Documents and Setting 526 MB

How big is your page file ? It could be that it increased instantly as you made some free space if your server is low on virtual memory. You could restrict your pagefile size on your C: drive and create additional page file on another partition. To do so, open Control panel->System->Advanced. Find Performance section and click Settings. Select Advance tab and click Change under virtual memory section. Make size adjustments but I would recommend to leave at least half of the size of your physical memory. Then add additional pagefile on another partition and choose size not smaller than you reduced on your C: drive. Don't put paging file on a hard disk where your databases are located as it could impact server performance.
You could use TreeSize utility to calculate folders size including subfolders and find out where most of your disk space goes. This tool can be found here: http://www.jam-software.com/freeware/index.shtml.
If you cannot find where your disk space has gone, you should check your NTFS partition with chkdsk utility.

Shadow copies is not enabled.

I didn't think of the page file. Would it cause problems if i moved the page file to another partition?

It could also be the content index. Anyway, consider granting yourself permissions to access the "\System Volume Information" folder and check its size.

System Volume is 18 GB. Can anything be done with this?

What kind of files are eating the space? Many small ones or few big ones? What extension do they have, if any? Do the file names contain GUIDs?

Try restarting the service "Volume Shadow Copy" and see if it does anything to the files.

The largest are .ci files. The are 6, 5, and 1 gig files. There are also some .dir and some .bk2 files.

"Volume Shadow Copy" is in manual mode and is not running. Should it be running?

Could be that starting "Volume Shadow Copy" removes the files. Try also enabling and disabling shadow copies on the C: drive.

I'm not sure if it's Shadow Copy that causes the waste, but it's worth a try. Currently, I have a similar problem on an external USB drive that used to contain an installation of Vista...

You cannot move pagefile manually. You can do it only as I described above. And it's actually not file move, it's how you distribute your page file on logical disks.

But it seems that problem is not in a paging file. There should not be such big .ci files on C: drive. I'm not even sure what those files are. What folder are they located in ?

Also you could move your backup files to another drive. bk2 looks like a backup files.

I Started Volume Shadow Copy and now I have "ZERO" Free Space. I stopped now

The .co and .bk2 files are located in the "System Volume Information" file

The best i can tell from Google searches is that the information in the System Volume Information folder has to do with system restore points. As far as i can tell that isn't a feature in server 2003. I tried to move a 1GB file but it wouldn't  let me. I said that the file was in use.

As it turns out the contents of the Systme Volume Information folder was associated with the Indexing Service. I Stopped the indexing service and deleted one of the 1GB files which suprisingly freed up over 3 GB of data.
Thanks to all for your assistance.