Without knowing the spec of your computer, I would say that it's just not powerful enough to handle the amount of data being sent to it.
Possibilities:
- hard drive is too full
- hard drive is too slow (it doesn't have the room or speed to swap data fast enough)
- Not enough Ram
- Computer CPU isn't fast enough for current version of the IMovie software.
Also, there could be an issue with the camera you have connected to the computer. Some cameras aren't designed to interface with Apple Applications - they were made with/for specific software.
You can try to reinstall the driver that came with your Camera, attempt to clean out the computer, add more ram, run the latest software updates... but likely, there is a combination of the above that simply won't work.
An alternative may be to use the software that came with the camera. Record what you want using that, and then Import the movie file into iMovie.
