This is an Excel limitation at least for 2003. This was the information on Microsofts website:
"Applies to
Microsoft Excel 2003
Maximum number of rows and columns
A Microsoft Office Excel worksheet contains 65,536 rows and 256 columns. You cannot increase the number of rows or columns beyond the maximum row and column limits.
For information about specification limits in worksheets, workbooks, workgroups, calculations, PivotTable reports, and charts, see Excel specifications and limits"
Here is a link with the information:
http://office.microsoft.com/en-us/excel/HA101375451033.aspx?pid=CL100570551033