Son las "cadenas literales" las que no pueden ser de mas de 255 caracteres en el codigo fuente, no las variables String.
Separa en 2 o 3 la cadena literal (lo que esta entre comillas simples) y listo:
Código Delphi
[-]
Str:= 'xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx' +
'xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx' +
'ddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddddd';
Saludos