Not really. Even with Excel 2007, which allows more than 255 columns, you
can't get more than 255 when you connect to the sheet as a mailmerge data
source.
Your best bets are /probably/ either
a. export the data to a tab-delimited format (either in a plain text file
or Word file), and try using that as the data source for a merge. However,
doing that from Excel is non-trivial and there are often problems with Word
not recognising the data int he data source properly. Or
b. instead of using Merge, use automation to get the data from your sheet
and place it in "fields" that you have marked with placeholders of some
kind - i.e. "roll your own merge"