In the editor open your Editor Preferences, from there under General, go to Global.
Set locations for Local Derived Data Cache and Shared Derived Data Cache, on a drive with large free space.
Actually before that create a new folder on that drive and set the locations inside that folder if you prefer.
These will be the cache folders for the version of Unreal you are using. Mostly for the compiled shaders and such, which take a lot of space.
Edit: If you don’t fill those areas, your default location for them will be inside your system drive I think, and that’s why it uses a lot of space to use UE4 there.