Acronis action if backup device doesn't have enough free space

My C drive has 457 GB of free space and I am doing a full disk backup to a Seagate FreeAgent 250GB drive. When I start the Full disk backup Acronis indicates "size to backup 126.3 GB" and when I show available space on my Seagate drive it shows 94.2 GB. I am trying to eliminate this situation as a problem I am having getting a successful backup. Acronis will run even though indications are that there is not enough space on the backup drive. Isn't Acronis smart enough to detect this and automatically prevent the backup from running or does it use some kind of compression that uses less space than initially indicated.

As you can tell I am not very technical and will appreciate any help you may provide.......Ralph

I am running Windows 7 Professional and Diskeeper 2010 Home build 14.0.896.0 (i haven't updated to the newest build)