Removing New+Folder from Document Libraries
Question: How can you remove the New + Folder menu command that is automatically added to some document libraries?
Answer: You will notice that the New + Folder menu command is added to some lists (typically document libraries) but not others (for examples, lists). This is determined by the template used to create the list / library.
There have been, and still are, many discussions about whether folders should be used in lists and libraries. Many believe that views should be used to group items together based on one or more columns in the list. This has the flexibility of allowing users to select how they want items to be grouped.
Anyway, to remove or add the New + Folder menu command:
1. Select the Settings + Document Library Settings for the list.
2. Select Advanced Settings.
3. Select Yes or No for ‘Display “New Folder” command on the New menu?’

4. Click OK.
[...] Leaving these discussions aside, what if you want to disable folders entirely in a list or library? This post describes how you can remove the New + Folder menu from lists and libraries, but unfortunately [...]
Cracking down on Folders in SharePoint « Nick Grattan’s Techy Blog
December 2, 2007 at 6:50 pm
However, if you do that, the files and folders will be mixed together in document library, instead of folders being listed above files.
So far I only figured out how to remove that “New” menu button all together, and I’m still searching for just removing “New Folder” menu.
Calvin
January 31, 2008 at 7:49 pm
Hi! I was surfing and found your blog post… nice! I love your blog.
Cheers! Sandra. R.
sandrar
September 10, 2009 at 2:18 pm