The latest iMovie has a minor bug in it. The upload to Vimeo button may not work. The way to fix this is to choose ‘Share:File…’ instead of ‘Share:Vimeo…’ from the File Menu.
Save your movie as a file.
LargeThen upload your movie to Vimeo using the Vimeo website.
The problem seems to be that iMovie tries to upload the movie as a .mov file but Vimeo wants an mp4 file.