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We have a small SharePoint deployment with a handful of team sites deployed. One of these sites had a document library that recently hit the list view threshold (currently set to the default of 5000). In order to rectify the problem, we organized all the documents into folders as they act as separators as far as the list view threshold is concerned. However, another library in the same site is now approaching the threshold. The difference in this library is that all of the documents are organized into document sets. This leads me to the following question:

Can document sets be used to alleviate the list view threshold problem in the same way that folders are, or will we need to find another way to organize our content?

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Document sets are more advanced form of Folders in SharePoint and yes it can be used to alleviate the list view threshold problem But to counter the threshold limit problem in SharePoint it is recommended to create views and add filters to refine your result in a particular view.

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