Sign language is probably the origin of base ten mathematics. Our minds find numbers up to ten straightforward, after that we're dealing with complexity. It might be nonsense but most two year olds would probably agree with it. On this basis it's probably wise not to offer choices in blocks of more than ten. Eight would be preferable, five even better, but if you have to push the limit then it's probably ten.
Many search engines return results in blocks of ten.
That doesn't mean you can't go beyond ten navigation links on a page, but if you do, try to divide them into blocks of no more than ten. Even then you'll pay a price in confusion, but if you have a big site you might think it's worth it. The majority of high-end users on the Internet are familiar with computers and build directory structures on their own machines. Some of these structures could rival your entire site in complexity and may contain more files. If your site is aimed at these high-end users then you can assume they're recreating your directory structure in their minds as they become familiar with your site layout.