tar Error: "gzip: stdout: Cannot allocate memory"

[imagenesis]

-bash-3.2# tar -xzvf lzo-2.03.tar.gz

gzip: stdout: Cannot allocate memory
lzo-2.03/
lzo-2.03/src/
lzo-2.03/src/lzo_dict.h
lzo-2.03/src/lzo1b_8.c
lzo-2.03/src/lzo_ptr.h
lzo-2.03/src/lzo1z_9x.c
lzo-2.03/src/lzo1y_o.c
lzo-2.03/src/config1x.h
tar: Child returned status 1
tar: Error exit delayed from previous errors

This is on a VPS with 256mb memory. vmstat and /prov/meminfo both show that over 200mb is free.

[amlife]

I guess this file is corrupted !!! try to copy it to another linux system and try to extract it.