This link claims to prove it can be done 12 times!
http://www.osb.net/Pomona/12times.htm
I'm
too thick to follow the maths, but apparently 7 is no longer the limit...
Yes and No....without an advanced degree in maths and engineering then 7 is the limit for any bit of paper......technically as described in Waldo's link it is possible but you have a pretty safe pub bet as long as you add in the magic word "Half" after fold.
It's not that surprising when you think about it - the size of the paper is irrelevant, it's the thickness that counts. A piece of paper folded in half seven times will be 128 times as thick (2 to the power 7) as it started at, which makes it harder to fold for exactly the same reason that cardboard is harder to fold than paper.