Check the following spots on your Mac before attempting to upgrade to Lion. Your Mac must be running OS X 10.6.8 Snow Leopard in order to purchase OS X Lion from the Mac App Store. Click the Apple in the upper left corner of your Mac and select Software Update to upgrade to 10.6.8.
If you are running Leopard (OS X 10.5), you must buy Snow Leopard on DVD before you can update to Lion. 
Processor
Lion can only be run on certain Intel Processors. Go to the Apple in the Upper left corner of your screen and select About This Mac to view your processor’s type. Your processor must be an Intel Core 2 Duo, Core i3, Core i5, Core i7, or Xeon processor to run Lion. The earliest Intel Macs with Core Solo and Core Duo (without the 2) processors will not run Lion. PowerPC Macs (such as the iBook and PowerBook) manufactured before 2006 are also not compatible.
Memory (RAM)
Officially Lion requires a minimum of 2GB of RAM to run. You can view your Mac’s RAM right under Processor in the About This Mac. The more RAM you install the faster your computer will run.
Hard Drive Space
You’ll need 5GB of free disk space just to download the Lion installer but you’ll want at least 20GB available to safely run the upgrade and continue using your Mac. To check how much free space your Mac has, select your hard drive and choose File > Get Info. If you don’t have enough “Available” space, we can help you upgrade your drive in about 1 day.
Firmware Updates
Some Macs may require a firmware update to run Lion. You may have been prompted to run a firmware update while using Software Update but just in case you can check if your Firmware version is up to date on Apple’s EFI and SMC firmware updates article.