While there is no technical limitation to the number of category values you can use in a list, there are several practical limitations you should consider. Flatfile was not designed with lists of more than 100 category values in mind, and using longer lists of values than this may negatively impact your experience.
If you have a list of less than 100 category values, Flatfile shows a popup sheet that allows you to match the data. However, if you have a list of more than 100 category values, the data is imported as-is, and without matching.
For longer lists of category values, you can use a Data Hook to transform and validate your data (you can learn more about Data Hooks in Portal 2.0 here and Data Hooks in Portal 3.0 here). Or, you can use the relational data feature to link the data containing your category values to the rest of your data.