Not Enough Storage Is Available To Complete This Operation

Hi,

I am having trouble trying to import a big file (aprox 250Mb is size) into an SQL Server database and I keep getting the message:

"Not enough storage is available to complete this operation".

The application tries to import the file by executing a stored procedure:

CREATE PROCEDURE sp_updateMaterialBlob
@MaterialId Int,
@BLOB image
AS
BEGIN
Update Material SET blob = @blob where id = @materialId
END

The application uses an ADO connection. I've tried increasing the memory of the client machine but that didn't work. Whenever I do run the import, nearly all the memory on the machine is used up but every time after several hours I get the same error message. What is the cause of the problem and how do I resolve it? Ideally I want to use my application to do the import rather than anything bespoke.