Thanks for posting this question. I have some additional insights that may help some developers.

I am debugging my application on a device (not the emulator). The device has 21 MB free on /data (as revealed by "df" when doing "adb shell") and my app is only 5 MB. However, I did find that if I deleted other apps on the device (without rebooting the phone or restarting adbd), INSTALL_FAILED_INSUFFICIENT_STORAGE would go away for a while and then come back.

So it seems that debugging my 5 MB app requires more like 20 MB of space in /data , and in addition something was leaking each time I debugged my app.

So I did "adb shell" and listed the ENTIRE /data directory with

cd /data ls -a -l -R

And I looked at the 5000-line output to see where all the space was going.

I discovered vast quantities of wasted space on my device in the /data/klog directory in the form of old log files from months-old debugging sessions.

These were not my log files: they were created by some part of the Android infrastructure.

I deleted them and instantly saved 58 MB which was not attributed in the Settings app to any particular app. I have a small device so 58 MB is very significant (about 40%).

So far, I have not gotten INSTALL_FAILED_INSUFFICIENT_STORAGE again after many runs. Let's hope that was the real issue, though the OP suggests that his device had plenty of space (but didn't say how much).

Hopefully some of you will also be able to escape INSTALL_FAILED_INSUFFICIENT_STORAGE by periodically deleting /data/klog/* .