A method and system for reallocating the data blocks of a logical data entity are described. According to one aspect of the invention, the physical arrangement of data blocks of a logical data entity are analyzed to determine a fragmentation level. Next the fragmentation level is compared with a fragmentation threshold previously assigned to the logical data entity. If the fragmentation level exceeds the fragmentation threshold, only those data blocks of the logical data entity that are within a predefined allocation area having a predetermined number of contiguous data blocks that are not associated with the logical data entity are reallocated.