[wlug] "Too many open files" error

I am running an application server on Red Hat 8.0 and every so often the machine generates an error message "Too many files open" and then locks up. I have to restart the machine from the console to rectify the situation. Can anyone please tell me if there is some configuration setting that I can change to increase the number of permitted files? Is there some command that allows me to monitor the number of open files in the system? Thanks in anticipation Roger