Users reporting boot failures after installing Thunderbolt software update
Some users who have downloaded Apple's recently-released Thunderbolt 1.2 software update are finding boot-related problems that can cause Mac instability to the point where the computer becomes unusable.
According to various posts on Apple's Support Communities webpage, the software update pushed out on Monday to bring compatibility for the new Thunderbolt Gigabit Ethernet Adapter has reportedly been causing a number of Macs to freeze and suffer boot errors.
It is unknown how widespread the problem is, though affected users are reporting kernel panic crashes or improper boots that force drastic action be taken before the Macs are once again operational. Remedies for the bug include a reapplication of the combo updater, restoring from a backup or a complete reinstall of OS X. As of this writing, only OS X 10.7.4 Lion users have experienced the issue.
A report from CNET has found that the Thunderbolt update applies to a single kernel extension called "IONetworkingFamily.kext" and is possibly carrying a bug that makes the connectivity kernel incompatible with Lion Macs. The report also noted the process of installing the new Thunderbolt software cannot be reversed since it is an update to an extension and not the installation of a completely new kernel.

While the problems persist Apple hasn't yet pulled the update from its Support Pages and the company hasn't issued a formal statement as to what may be causing the issue.
According to various posts on Apple's Support Communities webpage, the software update pushed out on Monday to bring compatibility for the new Thunderbolt Gigabit Ethernet Adapter has reportedly been causing a number of Macs to freeze and suffer boot errors.
It is unknown how widespread the problem is, though affected users are reporting kernel panic crashes or improper boots that force drastic action be taken before the Macs are once again operational. Remedies for the bug include a reapplication of the combo updater, restoring from a backup or a complete reinstall of OS X. As of this writing, only OS X 10.7.4 Lion users have experienced the issue.
A report from CNET has found that the Thunderbolt update applies to a single kernel extension called "IONetworkingFamily.kext" and is possibly carrying a bug that makes the connectivity kernel incompatible with Lion Macs. The report also noted the process of installing the new Thunderbolt software cannot be reversed since it is an update to an extension and not the installation of a completely new kernel.

While the problems persist Apple hasn't yet pulled the update from its Support Pages and the company hasn't issued a formal statement as to what may be causing the issue.
Comments
I'd read the reports of the problems after I'd downloaded the update, but before I'd restarted to install it.
I just went back to Software Update to make that update Inactive so I wouldn't install it by accident and found it was no longer in my Software Update queue.
Could Apple have pulled it from Software Update, but not from its Support Site?
For the few times I use Thunderbolt at the moment, I'll happily wait for a revision of this one...
Bummer. I installed it and immediately upon restart got a kernel panic. Had to do a clean install of 10.7.4 to get rid of it. Only took 8 hours as I had to reboot from another volume, do a back up and then the re-install. I should know better than to do a software update when it first comes out.
Everyone knows you should have a bootable backup before you install any software or updates. If you don't do this, it's your fault not Apple's.
That's silly.
Yes, you should have a bootable backup before installing software, but that doesn't mean that Apple's not at fault if an update fails.
Something told me to hold off on this update. Mainly because I have no Ethernet Gigabit adapter lol.. but so glad I did. Stability is one of the big reasons why I bought a Mac!
Edit: Seems to have restored perfectly from Time Machine
[B][SIZE=4]Apple shame on you for putting this out without enough testing !
Mistakes like this is why I quit using Microsoft products.[/SIZE][/B]
You joined the group to state it took you 8 hours to reinstall OS X? I'd say you'd have been better learning how to reinstall OS X or better yet how to clone a back up.
A second reboot solved the problem.
WTF!?! Who wrote this? This is utter nonsense. The very fact that it's not a kernel change means that it is reversible. Just replace with the IONetworkingFamily kernel extension from the 10.7.4 combo update. It wouldn't be easily reversible if it was a firmware update. But a mere file... get a grip.
WTF is the "connectivity kernel"? No such thing. lol. I assume they meant "kernel extension". The word kernel alone makes no sense. It's the thing the extension extends and is the heart (a single entity) of OS X.
Totally their fault, a major screwup of which they are totally aware, and yet no apology for those who ended up spending their day doing 10 hour restores of their systems. Love those guys ...
No one is doing a ten hour restore.
I installed the Thunderbolt update on my MacBook Air 2011, and at least I didn't have ant reboot problems. But I have had strange behavior from my WiFi connections.
I have had to turn WiFi off and back on to get a connection established. Before I had no problems.
That's not true.
I had a hard disk go bad. I had to restore from a Time Capsule over WiFi. Since I wanted to start with a clean system, the OS also had to be downloaded over WiFi. From start to finish, it was pretty close to 10 hours.
If the latter, then a restore from a Time Capsule most definitely takes 10 hours or more, depending on the connection and size of the hard drive.
In my case, I am using gigabit Ethernet to restore a 600 GB drive, that's roughly a transfer rate of 54GB/hour. GB Ethernet is approximately the same transfer rate as USB 2.0 and FireWire 400, assuming I were using an external HD rather than a TC as my backup drive.
So, yeah, I would imagine most people are doing around 10 hours.
It takes about an hour to do a full install of Lion over USB, so I can only imagine it would take quite a bit longer over the internet, which is the only option most of us have anymore since Apple went with the brilliant move to eliminate physical copies. And let's not talk about how long it takes to reinstall from an original restore disk and then update over the Internet to the current OS version, which is not really an option if one is doing a straight re-install over existing data.
Once again Apple is a little ahead of the curve. They really need to introduce Thunderbolt to the Time Capsule, and back up drives likewise need to be of the Thunderbolt variety to make a typical restore practical in today's tech reality as most people have 500GB minimum in their Macs. This is especially urgent if Apple is going to keep screwing the pooch like this with what should otherwise be minor updates.
The latter, but I hadn't considered 4TB drives… Technology, huh.