i found the same problem trying to upload a 3M file

php log say:
May 18 10:49:38 apps01 apache2: PHP Fatal error: Allowed memory size of 20971520 bytes exhausted (tried to allocate 6417776 bytes) in .../mantis-1.0.3/core/file_api.php on line 597

so i change in php.ini :

memory_limit = 100M

i just saw something similar, though using mantis 1.2.0rc1

tried uploading an 8mb file
received the following error:

Fatal error: Allowed memory size of 134217728 bytes exhausted (tried to allocate 33555277 bytes) in /usr/share/mantis/www/core/error_api.php on line 379

huh? exhausted 134217728 while trying to allocate 33555277?
134217728 is 4 times larger than
33555277

settings:
php.ini

post_max_size = 19M

max_execution_time = 120 ; Maximum execution time of each script, in seconds

max_input_time = 120 ; Maximum amount of time each script may spend parsing request data

memory_limit = 128M ; Maximum amount of memory a script may consume (default: 16MB)

mantis/config_local.php

$g_allow_file_upload = ON;

$g_file_upload_method = DATABASE;

$g_max_file_size = 19922944; #expecting 19M; not sure if i need 191024 here or 19  1024 * 1024

maybe a timeout occurred but if so the error should reflect that rather than the max memory setting

Typically a timeout error. Try reconfiguring the timeout period of PHP. I can upload large files on remote server using Mantis 1.2.4. IMHO Issue can be closed if Docimentation is adjused to give a hint a solution. BTW this is certainly not a Blocking issue.