Why do I have over 500 SystemData files on my macbook

Because you don't know how to use Spotlight search.

Just searching for the word "systemdata" matches all n-tuple hundred subfolders named SystemData that are legitimate contents of package folders in your local Library Containers folder. I have 761 of these. Do not remove them. These are not folders you should be concerned about, much less attempting to sort. They are there for a purpose.

Follow the previous advise >> First

The final word from Apple on Managing the " System Data “ Category

System Data: Contains files that don’t fall into the categories listed here. This category primarily includes files and data used by the system, such as log files, caches, VM files, and other runtime system resources. Also included are temporary files, fonts, app support files, and plug-ins. 

You can't manage the contents of this category. The contents are managed by macOS, and the category varies in size depending on the current state of your Mac.

There are areas of the Operating System which we users have control over and that is the User Account Folder ( Home Folder )

There is Purgeable Space and there is Empty Space.

Disk Utilities screen shot

Purgeable Space which is Controlled by the Operating System. When the Operating Systems decides the computer needs additional Empty Space, it will move a portion of the Purgeable to Empty space

AFAIK - there is no User Actions to hasten this transition from Purgeable to Empty Space

It can day or longer before this will occur.

The links below will help in identifying what is taking up space on the Internal Drive.

It will also provide possible ways to remove data that is under the direct control of the User ( Home Folder ) . 

Rebuild the Spotlight index on your Mac

What is “Other” storage on a Mac, and how can I clean it out?

Free up storage space on your Mac

GrandPerspective 

How to delete Time Machine snapshots on your Mac.  

Often caused if the Time Machine Drive has not been attached  to the computer and TM Backup is set to run on a Schedule. 

TM Backup will make Snap Shots on the Internal Drive awaiting the TM Backup Drive to be attached. 

Only then,  will the Snaps Shots be transferred to the External Drive.

View APFS snapshots in Disk Utility on Mac - Apple Support (CA)

See used and available storage space on your Mac

Locate backups of your iPhone, iPad, and iPod touch

If there a Suite of Adobe Applications  used on this computer ?

They may create some very large cache files that can be removed. Though, the Adobe cache files will be recreated as the Applications needs them.

https://helpx.adobe.com/ca/premiere-pro/kb/clear-cache.html

The same clearing of System Cache files can be achieved by booting into Safe Mode

They will be recreated as the System Requires 

All other areas are not accessible 

All of these SystemData folders are within individual containers in ~/Library/Containers. Here is the contents of the ~/Library/Containers/com.apple.iWork.Pages/Data folder.

VFaub wrote:

I'm having an issue where System Data is taking over 255GB of space on my M3 Pro Macbook and can't seem to find out why or the files that take up so much storage. I also would like to know if the fact that I have 551 SystemData files has anything to do with it, and if I can clear them without causing a cascade of problems.

Most of the files show ''0 bytes on storage'', but the odd one out will have 1MB on it but nothing inside. Sorting the folders by size doesn't seem to be working in this case as the first one will show 0 bytes and then the 10th one will have some size on disk.

The Storage window in System Settings is very confusing. What it calls "System Data" is most definitely not System Data. It's just "other" data that it couldn't categorize as a photo, movie, or document.

You will need to use a 3rd party Storage tool to see what is causing this. It might not even be a problem at all. But usually people never even notice this unless they run out of storage altogether. Just be careful with those 3rd party storage tools. If you delete the wrong file, you could suffer unrecoverable data loss. Try to avoid any "Library" folder if at all possible. Don't waste your time with apps or preferences files. You are looking for files bigger than 10+ GB in size.

Whatever you Do

Do not install Third Party Disk Cleaners / Optimizers

They tend to make a bad situation even worse