I'm using ubuntu 12.04, the live usb version.
Soon virtual disk on live usb gets full, after
df -h / shows:
Filesystem Size Used Avail Use% Mounted on /cow 124M 124M 0 100% /
How can I reduce disk usage on this live system?
The startup disk creator allows you to make a USB drive with any amount of space you want allocated to the home filesystem. If you intend running Ubuntu regularly from a USB stick then burn the image to a fair sized stick and allow as much as you want to be used by Ubuntu. If you are using it that regularly, you might want to consider a hard-drive installation?