How to Update Windows phone 7 to windows 8 :

How do I update my phone software?

We periodically release Windows Phone software updates to add new features you've asked for and to maximise your phone's performance. When a software update is available for you to download, we'll notify you so you can download it directly to your phone over a WiFi or mobile data connection. To see what features or improvements have been added in the latest update, see Windows Phone 8 update history.
Before you download and install an update:

• Make sure your phone is well charged, so you don't lose power during the update.
• If you're worried about mobile data charges, use WiFi and manually download the update. See How can I minimise my data usage? to learn more.
• Make sure you have enough storage space on your phone for the update. To check how much you have available, in the App list, go to Settings > Phone storage.

How to download updates automatically

1. In the App list, tap Settings > Phone update.
   
2. Tap the Automatically download updates if my data settings allow it checkbox.
   

   Note

   Updates won't download if data settings on your phone prevent it. For example, both Data Sense and Battery Saver can limit how your phone uses data. To learn more, see Using Data Sense to track data usage.

How to check for updates manually

1. In the App list, tap Settings > Phone update.
   
2. Tap Check for updates.
   
3. Make some room on your phone for the update. If necessary, remove a few unwanted apps or other large items.
   

Note

Windows Phone will let you know when new updates are available. If you check manually for an expected update and your phone appears to be up to date, it may be that it isn't available yet for your specific phone, mobile operator or market.

How to install an update

1. If you aren't set up to automatically download updates, tap Download when prompted after checking for updates or receiving an update notification.
   
2. Do one of the following:
   
   • Tap Install, tap Show details, then tap Install again. Your phone will restart, then install the update.
   • Tap Postpone if you want to go back to Settings > Phone update later to install the update.

   Note

   It usually takes 5 to 10 minutes to install an update, but it could take longer.
3. After your phone restarts, wait for it to migrate your settings, then tap Done to finish the update.