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FAT32 is a version of the File Allocation Table (FAT) file system that was introduced by Microsoft in 1996 with its Windows 95 OEM Service Releases 2 (OSR2) operating system. It is an extension of Microsoft’s FAT16 file system.
The purpose of FAT32 was to overcome the limitations of FAT16 and add support for larger media. The major enhancements introduced by FAT32 included support for much larger volumes, better performance and more flexibility and robustness.
The standard maximum volume size for FAT16 is 2GB, with a cluster size of 32K and sector size of 512 bytes. FAT32 increases this limit to a significant 2TB by increasing the number of bits used for cluster addressing. FAT32 reserves 32 bits for each cluster entry, of which the lower 28 bits are actually used for addressing the clusters.