A recovery menu on the Sony PlayStation 3 is a fail safe when it comes to fixing a PS3 that is not working properly. Everything from PS3 settings to its database can be restored using recovery mode. Another option in the recovery menu is the "System Update" option. The "System Update" option useful for people wanting to install custom firmware onto their PS3 systems.
Download the custom firmware PUP file from the developer's website or through a download mirror.
Connect a USB flash drive to your computer and click the "New folder" option on the USB flash drive window. Type in "PS3."
Open the "PS3" folder, and click "New folder" again. Type in "UPDATE" to name the new folder. Right-click the CFW PUP file and click "Copy" from the context menu.
Right-click the "UPDATE" folder and click "Paste" to save the custom firmware file on the USB flash drive.
Hold the "Power" button on the PS3 until it turns on and then off again. Press and hold the "Power" again until it beeps two times. Release the "Power" button. The PS3 recovery menu comes up.
Connect a PS3 controller to the PS3 by plugging its USB cable into the PS3 USB port. Select "System Update" on the PS3 recovery menu. The PS3 installs the custom firmware onto the PS3.
Select "Restart System" to reboot into the PS3 menu.