The upgrade can take some time. How long did you leave it and did come back to say failed? It is possible that there are issues with the ESXi partitioning and it fails. Make sure you have scratch located on a hard disk. If ESXi is installed on USB then I would just backup the configuration to a datastore and install to a new USB disk and restore the configuration. Make sure any HBAs additional NICs etc are on the Hardware Compatibility List http://vmware.com/go/hcl
Forum Upgrade Notice - We will be upgrading VMware Communities systems between 10-12 December 2010. During this time, the system will be placed in READ-ONLY mode.
-- David -- VMware Communities Moderator