Can't add to favorites in Windows Explorer

Problem Description: I did Clean install of Windows 7 Ultimate. However, I noticed that I cannot add any items under the favorites "star" icon that can be found on the left pane in windows explorer.

I tried drag & drop and "add current location to Favorites" but nothing works. I'm not getting any error either which is weird.

Solution: Generally When you open the desired directory then right click favorites, & click option add current location to favorites,it adds open directory link to favorites folder.

Similarly when you drag & drop desired directory to favorites,it adds open directory link to favorites folder.

Sometimes if links directory is deleted unknowingly this feature stops working as system doesn't know where to save the favorites links.
Simple way to fix this, create a folder in your document (C:\Users\*YourUsername*) called Links, it will solve the problem, if somehow it doesn't work then restart your computer to reinitialize all process it will fix the issue.