This is based on the following PHP values: upload_max_filesize and post_max_size. They both need to be larger than the size of file you are trying to upload.
In the Overview admin section, click on Show PHP Information and find the values for upload_max_filesize and post_max_size
and take note of the Loaded Configuration File to know where the php.ini file is located that is being used. Need to change these values there.
Consult your webhost for more help if needed to increase these values or let you use a custom PHP.INI with your gallery if this is a shared server and they don't want to modify the default values.