Postgresql doesn't accepts limits on text columns.

activerecord/CHANGELOG.md

 ## Rails 4.0.0 (unreleased) ##
 
+*   When running migrations on Postgresql, the `:limit` option for `binary` and `text` columns is silently dropped.
+    Previously, these migrations caused sql exceptions, because Postgresql doesn't support limits on these types.
+
+    *Victor Costan*
+
 *   Don't change STI type when calling `ActiveRecord::Base#becomes`.
     Add `ActiveRecord::Base#becomes!` with the previous behavior.
 

activerecord/lib/active_record/connection_adapters/postgresql/schema_statements.rb

@@ -396,6 +396,13 @@ def type_to_sql(type, limit = nil, precision = nil, scale = nil)
             when nil, 0..0x3fffffff; super(type)
             else raise(ActiveRecordError, "No binary type has byte size #{limit}.")
             end
+          when 'text'
+            # PostgreSQL doesn't support limits on text columns.
+            # The hard limit is 1Gb, according to section 8.3 in the manual.
+            case limit
+            when nil, 0..0x3fffffff; super(type)
+            else raise(ActiveRecordError, "The limit on text can be at most 1GB - 1byte.")
+            end
           when 'integer'
             return 'integer' unless limit
 

activerecord/test/cases/adapters/postgresql/sql_types_test.rb

+require "cases/helper"
+
+class SqlTypesTest < ActiveRecord::TestCase
+  def test_binary_types
+    assert_equal 'bytea', type_to_sql(:binary, 100_000)
+    assert_raise ActiveRecord::ActiveRecordError do
+      type_to_sql :binary, 4294967295
+    end
+    assert_equal 'text', type_to_sql(:text, 100_000)
+    assert_raise ActiveRecord::ActiveRecordError do
+      type_to_sql :text, 4294967295
+    end
+  end
+
+  def type_to_sql(*args)
+    ActiveRecord::Base.connection.type_to_sql(*args)
+  end
+end

activerecord/test/schema/postgresql_specific_schema.rb

@@ -192,5 +192,10 @@
 _SQL
 rescue #This version of PostgreSQL either has no XML support or is was not compiled with XML support: skipping table
   end
+
+  create_table :limitless_fields, force: true do |t|
+    t.binary :binary, limit: 100_000
+    t.text :text, limit: 100_000
+  end
 end