Newly created local disk is not available for selection in 'New Datastore' wizard of the ESXi host when attempting to create new Local VMFS Datastore
ESXi
VMFS
In order to be able to create a new datastore, there must be atleast 4194304 unused sectors (2GB). See the note under step 7 of Creating vSphere Datastores
The disk already has other partitions using up the entire capacity if the drive
If the disk was repurposed from another environment, you must clear its partition table to remove the partitions before you can create a VMFS datastore out of it. For instructions, see Clear a Device Partition Table in theVMware Host Client
Note: This is an irrevesible change as it will permanently remove the partitions hence, ensure that the data is no longer required.
Then, we may create a VMFS Datastore using the disk.For instructions, see Create a VMFS Datastore in theVMware Host Client