Mail Target Agent Error: "2147023754 SetMailboxInfo failed. An attempt was made to create more links on a file than the file system supports (4259934)

Mailbox synchronization is not working correctly, PST files are not getting processed by the Mail Target Agent and when reviewing the log, an error similar to following is found:
2006/11/08 03:34:51 PM CExchAdmin::SetMailboxInfoE2K Error -2147023754 SetMailboxInfo failed An attempt was made to create more links on a file than the file system supports. File: 'errors.cpp' Line: '278' File: 'aeExchAdmin2K.cpp' Line: '87'

This error points to a problem with Exchange server, most common being the disk space issue on the system drives. Stop the Mailbox synchronization, free up the disk space and restart the sync to resolve it.