A broken plugin, such as a module, has been detected. In order for the upgrade to proceed, the broken plugin should be deleted.
In the case of a Theme, then it is more than likely there is a file that has not been renamed correctly, or the theme is missing a vital component like a version.php, or that the version.php is not correct in some small detail, usually the plugin version. To correct this, you must add the theme/THEMENAME/lang/en/theme_THEMENAME.php file, where THEMENAME is the name of the theme folder. Inside that file, add the string "$string['pluginname'] = 'THEMENAME'; ". Make THEMENAME the name of your theme, however you want it displayed in the Theme selector.
Also, make sure to change your config.php file and version.php file to reflect the correct name:
In config.php: $THEME->name = 'NAME';
In version.php: $plugin->component = 'theme_NAME'; // Full name of the plugin (used for diagnostics)
For more information read Themes 2.0