Chances are it won't let you install an app that size to internal storage, because that would only leave about 200MB and so the system will probably tell you it hasn't enough space (it will always keep a minimum amount of space free, and on many phones that's rather more than 200MB).
Does your phone support moving apps to SD? If not then you need to clear stuff to create more space, end of (unless you want to get into rooting the phone). If it does, can you move other apps there to create space to download this one, then try to move it? For phones that support moving apps to SD there is a trick using adb to change the default install location (precise syntax has changed with time, but a search for adb shell pm set install location should find it), which may help - it's been a very long time since I did that sort of thing.