Attempting to add a KMZ file to ArcGIS Online may return the following error message.
Error: Unable to load KML: Unzipped KML file is too large. <value> bytes exceeds the allowable maximum of 10485760 bytes.
Note: A KMZ file is a compressed version of a KML file, which may include images.
This is a limitation in ArcGIS Online. When a KML file larger than 10 MB is compressed, it cannot be added to ArcGIS Online.
As a workaround, convert the KMZ file to a feature layer using the KML to Layer tool in ArcMap, and publish the output feature class and the layer file to ArcGIS Online. For more details, refer to the following web help document, Publish from ArcMap.
Note: As an alternative, convert the KMZ file to a CSV file to create a point feature class. Export the point feature class to a shapefile, and add it to ArcGIS Online.