A WebmasterWorld thread has one SEO/Webmaster claiming his ranking for his primary keywords died after using too many internal links in an effort to boost those keyword rankings.
In short, he noticed he was ranking semi-well for a number of keywords. To boost that ranking a bit, he decided to add a blogroll like navigation to his site and place those keywords in anchor text to the internal destination pages. He said, it backfired and now his keyword rankings for those queries have dropped.
He said:
I made an assumption that some good internal linking using the keyword in the anchor text in the same site would push the rankings up to page 1In effect i used the "Blogroll" style links in WordPress so i had a top 10 searched area listing these 10 keyword rich links on the right column of EVERY page
Since then my traffic overall on the site has gone down. Its almost a month since this change.
Do you think over linking internally can hurt you? Take our poll:
Forum discussion at WebmasterWorld.

Comments:
Sean Rusinko
08/17/2010 01:55 pm
Matt Cutts makes a reference in this Webmaster video to overusing phrases in your internal links, in relation to a blogroll. http://www.youtube.com/watch?v=A96yDPqa2rs Basically, Google detects this overuse and thinks "OK, I get it". Not exactly sure what they do in the effect of this overuse.
JU
08/17/2010 03:27 pm
In that case could be more a keyword stuffing problem than anything. I think that to be penalized somehow for having too many internal links should be something really excessive..
Pua
08/17/2010 05:45 pm
Weird, I've done the same thing before on my site, and have only seen my rankings & traffic improve.
Sarav
08/17/2010 06:13 pm
Of course, more internal linking is also considered as a black hat technique.
shary
08/18/2010 09:24 am
Come on!! Check Wikipedia. Internal links can never hurt your site.
Maciej
08/18/2010 10:15 am
I think whenever you have a "links" or "blogroll" section on your site you are setting yourself up for disaster. Google will look at a links page like a platform for link exchange which they have repeatedly frowned upon.
matt inertia
08/18/2010 12:30 pm
>> Of course, more internal linking is also considered as a black hat technique. Are you being sarcastic? If you are then fair enough! Internal linking like the poster has done shouldn't have had an adverse effect on his sites rankings. Did he remove it and see an improvement?
Dana Smith
08/18/2010 01:09 pm
I think if its a "natural" reasonable amount of links on a page its good, if you have to many- problematic and will be panelized
Judith
08/18/2010 03:04 pm
As the saying says "everything in moderation"... Blogrolls are not for internal linking. Use something in a way in which it was not intended and you just may have some unintended results, right? If it is helpful to the reader to add internal links for more info or details related to the page/post at hand and that is done wisely and with discretion, you shouldn't experience a negative impact on your rankings.
Savas
09/23/2010 11:42 am
yes it will hurt your ranking, that's what happened to us. you need to change the anchor text for each link. try using several additional words for variation, such as 'best restaurant baltimore', 'chinese restaurant baltimore' and 'downtown restaurant baltimore' in order to optimize for 'restaurant baltimore'
Panelized Home
01/27/2011 06:05 am
Yes, I agree with you.
SEO Professionals
08/20/2011 04:29 pm
The 100 link suggestion is from Google’s content guidelines. The aim is likely to minimize the relevance of links coming from link-farms. To answer the original comment’s question about internal links, Google’s sitemap guidelines also suggest keeping an sitemap limited to 100 links or breaking the map into smaller pages. It would seem from that statement that internal links should be kept to below 100 as well.