Mmmm thats likely to be a php file upload size limit. I think PHP by default only allows file uploads of 10 megs and under.
If you can access your php.ini then you could increase it.
I think, although this is of memory, its something like
upload_max_filesize
You may wish to also check upload time limits.
max_input_time
If you can't access that then maybe split the file into smaller more manageable chunks. The file is standard XML so should be pretty easy to do this
Just make sure you keep the headers and footer tags and then drop some of the posts.
Posts start it would seem with a
<wp:post_date>XXXXX</wp:post_date>
Where XXX is the posts date.