This partition is hidden by default, and most users aren’t even aware of its existence. It is automatically created while a clean copy of Windows 10/8.1/7 is being installed. The partition is carved out of the main system drive, which houses the operating system. Versions of Windows prior to Windows 7 do not have this hidden partition.
Windows Server 2008 and later also have this partition. The System Reserved Partition (often abbreviated to SRP) is a hidden partition created on Windows 7 and later.