Does SQL Server 2008 Express supports FileStream?

yes, it supports

So why I'm getting error: Incorrect syntax near 'FILESTREAM'.

you might be doing something wrong in syntax I guess.

No, here is what I'm doing:
GO
CREATE TABLE DocumentStore (
       DocumentID INT IDENTITY PRIMARY KEY,
       Document VARBINARY (MAX) FILESTREAM NULL,
       DocGUID UNIQUEIDENTIFIER NOT NULL ROWGUIDCOL
              UNIQUE DEFAULT NEWID ())
FILESTREAM_ON FileStreamGroup1;
 

Did you guys work on FILESTREAM on Express 2008 yourselves?

>>Did you guys work on FILESTREAM on Express 2008 yourselves?<<

not on express but used it in enterprise

q: is the FILESTREAM enabled?
http://msdn.microsoft.com/en-us/library/cc645923.aspx

q: did you create the proper filegroup?
http://msdn.microsoft.com/en-us/library/cc645585.aspx

q: what is the database compatibility mode?

here is the screenshot:

Untitled.png

you installed 32-bit sql server?!

Yub

Really? So FILESTREAM feature works only on 64-bit of 2008-Express? Any documentation on that please?

you migth try this one:
http://connect.microsoft.com/SQLServer/feedback/details/473895/cannot-enable-filestream-a-previous-filestream-configuration-attempt-was-incomplete

Thank you I read that thread but cannot find they mentioned that, can you please point me to where they mention that?

I fear that you have to contact MS directly to get that file ...