In order to burn a disc, the Mac will first make a disc image, which is basically a "virtual disc" on your hard drive. When you burn a CD, it just copies this "disc" from the hard drive to the CD. You therefore need at least 650MB (.65 GB) of free hard drive space.
If you're using Mac OS X, you should always try to keep at least a few hundred MB free anyway, to ensure that the system can operate properly.