According to Microsoft for Fat32...
"The maximum disk size is approximately 8 terabytes when you take into
account the following variables: The maximum possible number of clusters on
a FAT32 volume is 268,435,445, and there is a maximum of 32 KB per cluster,
along with the space required for the file allocation table (FAT).
"
Some versions of Windows have limitations on the size they can format.
I have a 1TB Western Digital, it came formated as fat32. I converted it to
ntfs.
The original documentation still on the drive says...
"Drive Format
This WD device is preformatted as a single FAT32 partition for compatibility
with all
updated Windows and Macintosh operating systems. The FAT32 file system has a
maximum individual file size of 4 GB. This WD device cannot create
partitions larger
than 32 GB in Windows 2000/XP/Vista."