Due to limitations with the calendar overlay feature, Outlook 2007 does not offer the option to compress weekends. Many users liked compressed weekends because it offered a visual clue that it was a weekend. The day and weekly views shade non-working days, and the weekly view can show only the work week but the monthly view doesn’t offer either option.

If you need the visual reminder that shading provides, you can easily reproduce the effect in the monthly view. Create an all day event that reoccurs weekly, on every Saturday and Sunday then assign it a color category and mark it Busy.

The last color category applied colors the date, so if you need to mark a date with another color, create an all day event for the event and assign a different color category. As long as the new event is marked busy, the day will take on the color of the category assigned to the newest event.

Although compressed weekends is no longer an option, you could set the calendar to begin on Monday so Sat and Sun are grouped together at the end of the week. (Tools, Options, Calendar Options)

If you use an older version of Outlook, the compressed weekend option is accessible by right clicking on the Monthly calendar and choosing Other settings.