I suggest you use the forum search; there is already a lot about this problem.
Today I started experiencing this issue as well after successfully uploading several photos. I did an extensive search on this forum and Google I was amazed to not find a clear resolution. This lead me to searching through the WordPress core files for the error message to see what was going on. The error message seemed to be triggered after the file was uploaded to the temporary directory where php stores the newly uploaded file. I did not have access to this directory, so I contacted my host and they were able to repair/remove the temporary files in the directory. This immediately resolved the issue for me and I hope this helps resolve it for all of you.
It appears to be problem with PHP temporary path where all files are stored while uploading them using PHP script. I suggest you to contact your host to investigate this further. Sometimes this also happens if your domain’s allocated disk quota is exceeded.
Kailash
