"Before we begin, I would like to mention that SharePoint is not really designed to handle huge files > 300 Mb). It stores all files in the content databases and that's where these large files are going. So I strongly recommend using file shares instead."

While it makes sense that in a default install all data is put in a content database and this is undesirable for reasons of performance and DB size I wouldn't put things in file-shares (thus outside of SharePoint) but instead enable Remote Blob Storage - SharePoint 2010 comes with Filestream support built in and other providers can be configured:

technet.microsoft.com/.../ee748638(v=office.14).aspx

Your post is very helpful but I have a user getting the file size error even though the file she is trying to upload is only 1/2 meg - WELL below the 50 meg limit.

This is very helpful and thorough. However, it makes me wonder: "What was Microsoft thinking!?" Couldn't they have foreseen that SharePoint may need to be used with larger files? Why didn't they simplify this process and make it idiot proof?

i think the max. file size is 250 MB not 50 MB. http://technet.microsoft.com/en-us/library/cc262787.aspx

I tried all the workarounds mentioned but still i couldn't upload files >28 MB...

I used GoodSync and upload and sync by way of WEBDAV connection works perfect and ignores character issues also

Surya >> I faced the same issue too. I did some testing in my environment previously and concluded that the actual file size that can be uploaded is about half of the limit. This means 50mb limit can allow up to 28mb. For 100mb limit, it can allow up to 56mb etc...