FATAL: Repeated failures to free up disk space

hello, I am using my squid to get out of my firewall so I did not want
to
have disk cache and set it to 1mb but my squid is giving this error
and exiting...what does this mean??? also I see that the cache directory

is getting big and then smaller and then big and smaller...
is this can be a fault when somebody try to fetch an object bigger than
1 mb?

1998/08/22 23:12:11| WARNING: Exceeded 'cache_swap' high water mark
(787K > 768$
FATAL: Repeated failures to free up disk space
Squid Cache (Version 1.NOVM.22): Terminated abnormally.
Received on Sat Aug 22 1998 - 13:19:33 MDT