This update is designed to improve org health and performance by restricting the number of inactive picklist values in a custom picklist field. We plan to remove the Remove upper bound on inactive picklist values panel from the Picklist Settings page in Setup in Summer ’23.
Where: This change applies to Lightning Experience and Salesforce Classic in all editions.
How: After the Remove upper bound on inactive picklist values panel is removed, you can’t remove the upper bound on inactive picklist values, and the maximum number of inactive picklist values for unrestricted picklists is 4,000. Any unrestricted custom picklists that were previously created without limits to the number of inactive values remain. Any new unrestricted custom picklists have a limit of 4,000 inactive values.
Prepare for Changes to the Picklist Settings Page (salesforce.com)