A PST file is created by Microsoft Outlook during the archiving of the outlook data items. The archive file size can be reduced using the Outlook Data File settings. To reduce the PST file size in Outlook 2010, click on the File menu –> Account Settings
Navigate to Data Files tab and select the archive file which needs to reduced. And then click on the Settings.. link.
The following Outlook Data File settings window would be displayed.
Now click on the Compact Now button and to reduce the size of the selected Outlook data file. The following progress message would be shown until the operation is complete.