There is a limit. I'm not sure exactly what it is, but I remember not being able to follow people once I reached that limit. It's based on a certain percentage of followers to non-followers if I'm not mistaken.
If you're looking for tips on how to increase your followership, I've written a detailed blog post on it that you can read.
I'm pretty sure there is no limit. As long as you don't needlessly spam and follow "common" (using the quotations here since it's in fact not common at all ) sense you should be fine.