How did you format it??? FAT, FAT32, NTFS.. Reason I asked is (1)"In FAT32, the root directory is unlimited in size. What this means is that you can have as many files and directories in C:\> as you'd like. In the days of FAT16, you could have a maximum of 255 directory entries. That means that if you had normal filenames of 8 letters + 3 extensions, you have a maximum of 255 directories + files."
footnote: (1) http://www.pcnineoneone.com/howto/filesystems2.html