As noted by Lysarion in the comments, the file to modify is
hudlayout.res. Previously, this was found in the
/tf/scripts folder in the
team fortress 2 content GCF archive. But now that the game has been converted to a new file system via SteamPipe, it's now in the
tf2_misc VPK archive which is stored in
/tf in the installation folder.
Fortunately, GCFScape can open VPK archives just as with GCF archives. Open
tf2_misc_dir.vpk in GCFScape and find the file in
Extract and search the file, then find the following field:
"RightJustify" "1" // If 1, draw notices from the right
HudDeathNotice field defines the appearance of the kill feed. You'll see at a glance the variable that tells the game how many items to display at most at any time:
Change that to any value you want, then save the file.
You used to be able to simply place the file in the
/tf/scripts folder in the game's installation folder. Now with the new file system, custom files are handled quite differently. This Steam KB article has all the info you need, but the simplest way is to open
/tf/custom, create a folder with any name you want if you don't have one already, create a
scripts folder inside that folder, then place the file in there. Then launch the game and you should see the change you made in-game.
There's a little caveat:
hudlayout.res is subject to changes in game patches, which won't be reflected in the custom version of the file. You may have to repeat this procedure in case of any changes to the original file outside of this modification.