Using the Microsoft Driver Development Kit (DDK), this error plagued me as I attempted even to build the default drivers included with the DDK.
I had a some difficulty in tracking down the cause and solution through Google. In an effort to aid others who may experience this same problem, I am documenting it here.
Solution: Make sure that the directory you are building in contains no spaces.
Tthe solution to this problem is to ensure that there are no spaces in the build directory.