An incrementally-scalable file system and method. The system architecture enables file systems to be scaled by adding resources, such as additional filers and/or file servers, without requiring that the system be taken offline or being known to client applications. The system also provides for load balancing file accesses by distributing files across the various file storage resources in the system, as dictated by the relative capacities of said storage resources. The system provides one or more “virtual” file system volumes in a manner that makes it appear to client applications that all of the file system's storage space resides on the virtual volume(s), while in reality the files may be stored on many more physical volumes on the filers and/or file servers in the system.