OS X Lion: Installer reports This disk cannot be used to start up your computer
Symptoms
When installing Lion, you may be presented with a chance to select which disk to target for install. In some situations, the disk you want to upgrade may be labelled "This disk cannot be used to start up your computer".
Products Affected
OS X Lion
Resolution
If possible, back up and reformat the target disk before installing.
If you cannot, try the following steps to resize the partition which you wish to install OS X Lion on: