issue

@Pranjali387673859gp3 

The scratch disk is not a Photoshop setting. It is real, physical disk space, and you don't have enough of it.

Raster image editing requires huge memory input/output, much more than any RAM you may have installed. So Photoshop writes temporary working data to disk. That's the scratch disk.

The scratch file vastly exceeds the nominal starting file size. Every history state, for every open document, potentially adds the full file size - plus overhead for advanced functions like e.g. smart objects.

Please read this (in particular the section titled "Supply pertinent information for more timely and effective answers”):
https://community.adobe.com/t5/using-the-community/community-how-to-guide-tips-amp-best-practices/td-p/11601738?page=1

What have you done about general Photoshop performance and Scratch Disks so far?
https://helpx.adobe.com/photoshop/kb/optimize-photoshop-cc-performance.html
https://helpx.adobe.com/photoshop/using/scratch-disks-preferences.html

What are your Performance and Scratch Disk settings?