Error while creating instance

Can you post your nova log.and your nova.conf file.
Will give us more info to debug your problem.

Thanks for your revert.

you can download file from below location :

https://www.transferbigfiles.com/86cf9606-f9d0-4333-be77-d43f3660dd95?rid=HbmL3-ScTnS6A_hel9YXfA2

File Contents :

1) Nova Conf
2)Nova Logs : all log files

In you log their is the following

2013-01-20 08:56:37 2473 TRACE nova.openstack.common.rpc.amqp raise exception.ImageTooLarge()
2013-01-20 08:56:37 2473 TRACE nova.openstack.common.rpc.amqp ImageTooLarge: Image is larger than instance type allows

It would seem you root disk is to large for the flavor you are using, I suggest to get things working that you remove, images, instances and then use a small distro to get things working.

Can you do the following

1) Delete all instances.
2) Delete all images.
3) Delete all you logs.
4) let things run for a while, capture logs. This is so we can see if their are any other problems other then image size.
5) Upload small VM image (Use a small distro image to begin with).
6) Create a instance from image.

If all dose not go well capture logs and post here again.

You can modify the settings later to increase the allowed root disk size when all is working.

Thanks for your prompt Support.

I am using KVM (VMbuilder) tool for image creations. let me know how to make small distro image. Is their any tool so I can build
 small distro image. In my Environment their are various clients any they required OS configuration as per their requirement. If there is now any tool for the same, let me know the step by step process for making small distro images for : Windows/linux/CentOS/Ubuntu etc...

Here is a link to a page about with info about openstack images.

http://docs.openstack.org/trunk/openstack-compute/admin/content/starting-images.html

On this page their is a cirrus image, use it to get openstack working correctly.

Once yor confirm that your environment is performing correctly, preform all functions correctly,

You can edit the flavours to allow for larger boot disk.

Here is a link to a page about with info about openstack images.

http://docs.openstack.org/trunk/openstack-compute/admin/content/starting-images.html

On this page their is a cirrus image, use it to get openstack working correctly.

Once yor confirm that your environment is performing correctly, preform all functions correctly,

You can edit the flavours to allow for larger boot disk.