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While trying to installing Ruby 1.9.2 using rvm, it was giving make error. So I checked the makeerror.log. It pointed to some readline error.
After searching through the web for a solution I hit upon the following link http://www.markhneedham.com/blog/2010/07/08/installing-ruby-1-9-2-with-rvm-on-snow-leopard/
Finally the solution is to install readline properly as given in rvm documentation http://rvm.beginrescueend.com/packages/readline/.
Also do not forget to update rvm itself and reload subsequently.
Hope this helps.