Guidelines for using folder structures in document libraries

When using document libraries in SharePoint try to avoid creating nested folders. There are several reasons you do not want to create folders more than one level deep if you need to create them at all.

1. Security can't be applied to a folder in SharePoint
   
2. Currently, you can't add a folder by itself to a web page in a web part
3. Why would you continue nesting folders, you are then recreating your file server structure all over again.

Instead of creating folders in Document Libraries create a seperate document library, this allows users to consume the content most important to them and you have more control over security and other features such as custom views.