System and method for managing leaf nodes of a B-tree for a file system of a computer system utilize used slots in a directory section of a leaf node to index variable size key-value pair entries stored in a data section of the leaf node and free spaces slots in the directory section to index contiguous free spaces in the data section. Contents of the free space slots in the directory section are updated in response to changes in the contiguous free spaces in the data section to manage free space in the data section of the leaf node.