Method and system for aggregating frames at a network device coupled to computing system is provided. The network device includes an aggregator module that is configured to determine that a frame received by the device meets a first level eligibility criterion for aggregation, where the frame meets the first level eligibility criterion when the frame is a data frame for the I/O exchange identified as a large I/O operation; and a frame header meets an eligibility criterion. When the frame does not meet the first level eligibility criterion and an active aggregation exists for the exchange, then a previous aggregation data unit with an appended header and the received frame are sent to a transport layer for further processing. When the frame meets the first level eligibility criterion, the aggregator module checks a data structure maintained by the network device to determine that an aggregation flow exists for the exchange.