Allocation of stack frames is limited to a maximum of 32k, regardless of how much memory is needed by local variables. Addressing of local variables, on the other hand, is also possible beyond the 32k limit. This can lead to unpredictable application behavior. No compiler warning is generated. See the C code below and the commented assembler output.

int main(void)
{
        char array[32770];
        array[0] = 12;
        array[32769] = 34;
        
        return 0;
}

results in:

10000690 <main>:
10000690:	27bd8020 	addiu	sp,sp,-32736    # char array[32770]
                                                        # only results in 32736
                                                        # bytes being allocated
10000694:	ffbe7fd8 	sd	s8,32728(sp)
10000698:	ffbc7fd0 	sd	gp,32720(sp)
1000069c:	27bdffc0 	addiu	sp,sp,-64
100006a0:	03a0f02d 	move	s8,sp
100006a4:	3c1c0011 	lui	gp,0x11
100006a8:	0399e021 	addu	gp,gp,t9
100006ac:	279c82a0 	addiu	gp,gp,-32096
100006b0:	2402000c 	li	v0,12
100006b4:	a3c20000 	sb	v0,0(s8)        # array[0]=12
100006b8:	3c020001 	lui	v0,0x1
100006bc:	03c21821 	addu	v1,s8,v0        # v1=s8+65536
100006c0:	24020022 	li	v0,34
100006c4:	a0628001 	sb	v0,-32767(v1)   # array[65536-32767]=34
                                                        # Addressing of local
                                                        # variables is possible
                                                        # beyond the 32k
                                                        # boundary
100006c8:	0000102d 	move	v0,zero
100006cc:	27dd0040 	addiu	sp,s8,64
100006d0:	dfbe7fd8 	ld	s8,32728(sp)
100006d4:	dfbc7fd0 	ld	gp,32720(sp)
100006d8:	03e00008 	jr	ra
100006dc:	27bd7fe0 	addiu	sp,sp,32736