If you want the drive to be readable and writable on a Mac as well, choose exFAT. In general, you’ll want to select NTFS if the drive will only be used with Windows. Depending on the drive’s size, your options will be FAT, FAT32, NTFS, or exFAT. File System: A file system is a data structure that tells an operating system how to save and load files to or from a disk.Formatting takes up some of the raw disk space because of how file systems work. Capacity: This will be the data capacity of your hard drive or SSD once it is formatted.