Out of the box, the storage allocation for My Sites is real small. In SharePoint 2010 and SharePoint 2007 you can increase the storage limits for each My Site.

In SharePoint 2010:
Central Admin > Application Management > Configure quotas and locks
First select the My Site Web Application, then select the users My Site you want to edit.
In the Site Quota Information section, change Current quota template to Individual Quota, then change Limit site storage to a maximum of: ___ to your new value.

You can also set the Send warning e-mail when site storage reaches value to remind the user they are running low on space.

Click OK, and you are ready for more storage.

Microsoft info on this topic:
http://technet.microsoft.com/en-us/library/cc263480.aspx#BKMK_ChangeQuotaTemplates