which version of gem do you h ave, is it the latest? I found http://allaboutruby.wordpress.com/2006/01/09/installing-rails-on-windows-step gem install rails --include-dependencies (If this command gives you an error, you do not have the latest version of gems installed. Run "gem -v", it should be 0.8.10. If it's an earlier version, I recommend to reinstall the newest package - see beginning of the tutorial).