I looked online and found some SO discussing and ActiveState recipes for running some code with a timeout. It looks there are some common approaches:
For "normal" Python code, that doesn't linger prolongued times in C extensions or I/O waits, you can achieve your goal by setting a trace function with sys.settrace() that aborts the running code when the timeout is reached.
Whether that is sufficient or not depends on how co-operating or malicious the code you run is. If it's well-behaved, a tracing function is sufficient.