avi files generally hang because of two reasons - either because of a bad encoding(corrupted) or because of lack of hardware to support the playing of the avi.
Incase of corrupted encoding of the file you can try re encoding it. Use
virtualdub. You can try fullly re encoding or decoding the avi file.
The other issue that is the hardware cannot support the file occurs generally in the case of really large files. In that the first effort should to be to try and speed up your computer (look up any article on speeding up windows). Try and free as much RAM as possible for playing the video, close all other processes. If it still hangs you need to upgrade your computer. Go for a faster RAM, motherboard. Or install a completely seperate graphics card for graphics processing. Should do that job.
You can even try breaking the file into several pieces.