Volume contains an OS X installation which may be damaged

Got the following message Volume contains an OS X installation which may be damaged. Quit the installer to restart the computer and try again, tried this without results. iMac mid-2008, 4GB Ram, with Mountain Lion 8.5 on internal HD and OS X 10.11 on external drive from which I could start with no problems. Now when OS X 10.11 is selected, computer starts up normally, progress bar reaches approx. 30% and then black screen and computer is off. Tried repairs to no avail. reinstalling OS X from internet would take 25+ hours… When booting from internal drive with MAC OS X 8.5. startup is normal and external drive where OS X 10.11 is located, mounts on desktop with all data visible and accessible. What to do?