how do i update or install ios 4.3 on my ipod touch?

I suspect you have a 2G iPod. Those can only go to iOS 4.2.1. Or a 1G since those cab only go to 3.1.3

Identifying iPod models

iPod touch (3rd generation)

iPod touch (3rd generation) features a 3.5-inch (diagonal) widescreen multi-touch display and 32 GB or 64 GB flash drive. You can browse the web with Safari and watch YouTube videos with Wi-Fi. You can also search, preview, and buy songs from the iTunes Wi-Fi Music Store on iPod touch.

The iPod touch (3rd generation) can be distinguished from iPod touch (2nd generation) by looking at the back of the device. In the text below the engraving, look for the model number. iPod touch (2nd generation) is model A1288, and iPod touch (3rd generation) is model A1318.

Thank you IIIaass,

This was the most helpful answer I've found in the last 45 minutes. I did not realize my iPod was a 2nd generation (I thought I had a 3rd) because it was given to me a couple years ago. This was the most clear and obvious answer to why my iPod would not update from iOS 4.2.1. It kind of ***** because I know I won't be able to update it anymore but it's still a good iPod.

Thanks again for such a simple, yet helpful answer.