This article is a slightly modified article from a great blog post at www.bluesunray.com about how to have our own php.ini with dreamhost.Thank you for your work:
0-Set up your domain for FastCGI (usually it is the case by default)
Login your Dreamhost, enter Manage Domains, Edit your domain setup, in Web Options->PHP mode, select ‘PHP 5 FastCGI’

  1. Download DreamHost Custom PHP.ini from DeamHost Scripts and Tips. Or attached here as of today dh-phpini
  2. Extract the dh-phpini.php from dh-phpini.zip and upload it to you website root.
  3. Open dh-phpini.php in you browse. Example: http://www.yoursite.com/dh-phpini.php.
  4. Then, this result shows,
  5. After install, this script create ‘cgi-bin’ folder in you website root, including ‘php.ini’ files in the folder, and add this lines in you .htaccess file, if they are not there already:

AddHandler fastcgi-script fcg fcgi fpl
AddHandler php-fastcgi .php
Action php-fastcgi /cgi-bin/dispatch.fcgi

6. Default, the Max upload file size increase to 20M, if you want to change to more, edit php.ini file in ‘cgi-bin’ folder like this,

post_max_size = 50M

upload_max_filesize = 50M

7.For changes to the new php.ini file to take effect , you’ll probably need to restart FastCGI for them to take effect.

Unfortunately you can’t do this from the Dreamhost Control Panel. You need to log in via SSH, and issue the command “killall -9 php5.cgi” to restart FastCGI.