You could add a identity column to the table, IDENTITY(1,1). This can be your guide for doing the updates in the table one batch at a time.

Borrowing on Jeff's tally table, the basic design goes like :

DECLARE@lowerID int=0, @higherID int, @maxID int;

SELECT@maxID = max(n) from tally;

SET@higherID = @lowerID +5000;

WHILE@lowerID<= @maxID

BEGIN

/* just to illustrate the concept */

select n from tally

where n between @lowerID and @higherID

/* here you would apply this to your table like so ... */

--update table yourtable

--set column_34 = ( CASE WHEN -- ... )

--where identityColumn Between @lowerID and @higherID

set @lowerID = @higherID+1;

set @higherID = @higherID+5000

END

You could also optionally include a checkpoint at the end of every batch with a waitfor delay