How to free up Storage Space on MacBook Air for Monterey Installation

See if this User Tip article can help: What is “Other” storage on a Mac, and how… - Apple Community

Sad news.

Yes, Apple should have never offered such a small drive to be available, 128 GB SSD

There is very little room on the drive to store both the operating system ( about 12 GB ) + all your third party plus any meaningful amount of personal files.

No matter how hard one tries to clean up the drive, you are always going to run into this issue.

You can try the suggestion previous suggested by @Tesserax and see where this goes.

But I think give enough time, the same issue will eventual reoccur

You may consider your options carefully if or what the time is right for you to look at purchasing a new or Newer Computer with at least 1 TB SSD or larger if your budget allows

This will kind of further proof you for when your needs eventually require greater storage space

Explore the Apple Trade-In  Process where the Value of the exiting device could be used against the cost of a new Apple Computer, iPhone or iPad 

Notation - Some devices and depending on the computers age may have little to no value at Trade In time.

But at least the device will not arrive to the Land Fill Site and be recycled in a responsible way by Apple

Or Shop Refurbished Apple computers at an Apple Reduced Cost

Have used both previously and have been satisfied each time.

Actually, used it yesterday to trade-in a M2 MBA with 500 GB SSD for the newest M3 MBA with 2 TB SSD Drive

Walletarian wrote:

Thank you. What is your opinion of M2 MacBookPro w 512GB internal? It seems to me Apple quickly skipped from M1 to M3. I can share my 2TB iCloud w grandson.

M2 MacBookPro with 512 GB >> do you see 512GB being enough Internal Space for Now and your further needs ?

iCloud 2 TB storage is good

But do realize, iCloud is only a conduit to have files on Both on the Internal Drive as well as on iCloud Drive.

Sign in to iCloud on all your devices

How iCloud keeps information up to date across all your devices

Apps and features that use iCloud

M2 is good and M3 is newer

Have 1 M1, 2 M2 and getting, on Trade, a M3

Once I have tested the M3 for my usages, then I can offer a more reasonable assessment