Problem with avatar upload - fatal error

Avatar image upload works fine as long as the file size is around 100KB or less. But anything larger, and the following appears:
Fatal error: Out of memory (allocated 46399488) (tried to allocate 7776 bytes) in /home/vrichins/public_html/libertydiscussions.com/wp-admin/includes/image.php on line 162

I can't seem to figure out what the hangup is. Suggestions?

I'm using the latest versions of WPMU and BuddyPress, with the BP Social theme.
http://libertydiscussions.com