If you try to install a Joomla template and receiveing this error message:

"There was an error uploading this file to the server"

it can be that your file size limit is to small. For example: Some template comes with extra stuff like a set of selectable background images or sample header images so that the size of the installation file is bigger than 2MB. But some server provider set the file size limit to just 2MB by default. If you than try to install a template you will receive the error message above.
The solution is to increase the file size limit to a higer value. You can do this by uploading the PHP.ini file, which is attached to this article, into your Joomla root directory and the "/administrator" subdirectory. It will set the limit to 32MB.