You could use the following divide-and-conquer strategy:
Create a function H() that can assign each record in the input file a number. For a record r2 that will be sorted behind a record r1 it must return a larger number for r2 than for r1. Use this function to partition all the records into separate files that will fit into memory so you can sort them. Once you have done that you can just concatenate the sorted files to get one large sorted file.
Suppose you have this input file where each line represents a record
Alan Smith
Jon Doe
Bill Murray
Johnny Cash
Lets just build H() so that it uses the first letter in the record so you might get up to 26 files but in this example you will just get 3:
<file1>
Alan Smith
<file2>
Bill Murray
<file10>
Jon Doe
Johnny Cash
Now you can sort each individual file. Which would swap "Jon Doe" and "Johnny Cash" in <file10>. Now, if you just concatenate the 3 files you'll have a sorted version of the input.
Note that you divide first and only conquer (sort) later. However, you make sure to do the partitioning in a way that the resulting parts which you need to sort don't overlap which will make merging the result much simpler.
The method by which you implement the partitioning function H() depends very much on the nature of your input data. Once you have that part figured out the rest should be a breeze.