.....

Hi Carl, I don't know of any way to limit the number of downloads in the list.

Other options to consider -

You can right-click on the Downloads button and select Remove from Toolbar. This puts the button back in your Customize panel and effectively turns off the Downloads Panel. You can easily restore the button - https://support.mozilla.org/en-US/kb/customize-firefox-controls-buttons-and-toolbars

You can select Show All Downloads at the bottom of the list and open your Downloads Library. Click the Clear Downloads button at the top of the Library window to clear the entire history of downloaded items. This will not delete the downloaded files. **Selecting Delete will delete the download permanently**

Also see - Where to find and manage downloaded files in Firefox https://support.mozilla.org/en-US/kb/where-find-and-manage-downloaded-files-firefox

How file downloads are handled in Firefox version 98 and above https://support.mozilla.org/en-US/kb/manage-downloads-preferences-using-downloads-menu

This thread here hints that the count could be parameterized in a future version

https://www.ghacks.net/2013/06/06/increase-the-file-limit-of-firefoxs-download-panel/

It was posted 9 years ago though, and I don't see any follow-up indicating that there'd been any traction on this.

I thought it would be helpful, but the add-on is no more.

You can stop the panel from always showing by changing this preference to false in about:config. You then see the panel only when you click on the downloads arrow. browser.download.alwaysOpenPanel

https://support.mozilla.org/en-US/kb/about-config-editor-firefox