Miners collect bitcoin transactions into distinct packets of data called blocks. Each block is cryptographically linked to the preceding block, forming a "blockchain."
The size of these blocks is currently limited to 1 megabyte. Since miners earn the fees from transactions included in their blocks, they have a direct incentive to mine larger blocks with more transactions. As more people use the bitcoin network for bitcoin transactions, the block size increases. Today, most blocks are close to the 1 megabyte limit.