Hello,Is defraging necessary in exchange 2003 if mailboxes are deleted or removed from database, Or does exchange continue to use the white spaces available as a result of the deletion of the mailboxes until all is used up?

Exchange will use the white space in the database.To see how much free space is avail:http://support.microsoft.com/kb/186291Cannot determine free space available in Exchange database I recommend doing an offline defrag unless there is a very compelling reason.

See my answer in:http://social.technet.microsoft.com/Forums/en-US/exchangesvrgeneral/thread/db90f26e-f7c4-447b-b87a-4a76e9502518