I just updated Android SDK to version 21 and trying to start emulator. I am using Nexus 4 with CPU Intel atom (x86) 768 RAM and 524 internal storage. Emulator starts fine but it
You have to go in your android folder e.g. on OSX ~/.android/avd/{YOUR_AVD_NAME} and edit file config.ini.
Just add or modify row disk.dataPartition.size = YOUR_SIZE
disk.dataPartition.size = YOUR_SIZE
e.g. disk.dataPartition.size = 1G
disk.dataPartition.size = 1G
Then you may have to wipe your emulator's disk.