There is (as far as I know) no such version as iOS 4.3.1. Is it actually iOS 4.2.1?
Also, you need to correctly identify which generation iPod Touch you have, because iOS 4.2.1 suggests that you may have a 2nd generation Touch, which cannot be updated beyond iOS 4.2.1. Look on the rear casing of your iPod. Can you see the Model No. Axxxx? What does it say?
Alternatively, see http://support.apple.com/kb/HT1353 for help in identifying your model.
There is an iOS 4.3.1
If you truely have a 3G iPod with 4.3.1 you can update to 5.1.1 by:
You need iTunes version 10.5 or later on the computer.