The update would not have installed if there wasn't enough disk space. How long did you wait with the spinning wheel (or did the wheel stop moving)? It can sometimes take a while after an update.
Try the usual: boot from the restore disks or an OS X retail disk (if you've moved up to Leopard. Run Disk Utility to make sure everything is OK. If it still won't boot, you might need to try an archive and install. However, if you are concerned about free space on your drive, hook up the machine to another with Firewire target disk mode and clear off some stuff to make space.
Steve