(Sometimes, more euphoniously, "second-system syndrome") When one is designing the successor to a relatively small, elegant, and successful system, there is a tendency to become grandiose in one's success and design an elephantine feature-laden monstrosity.
The term was first used by Fred Brooks in his classic "The Mythical Man-Month.
It described the jump from a set of nice, simple operating systems on the IBM 70xx series to OS/360 on the 360 series.
A similar effect can also happen in an evolving system; see Brooks's Law, creeping elegance, creeping featurism.
See also Multics, OS/2, X, software bloat.