Then this week AVG released a mandatory update for AVG 2011 Free that has been causing severe issues, especially on systems running Windows 7 64-bit. This has been widely documented on the company's forums where it's been identified that the antivirus' database update 271.1.1/3292 (432/3292) will prompt you to restart, after which the OS will come to a halt, show a "STOP: c0000135" error and completely fail to boot.
AVG has promptly pulled the update from its website and come up with a set of instructions to bring your system back up. The fix requires the use of AVG Rescue CD that can also be used to boot from a USB drive.
Unfortunately this reminds us of the ZoneAlarm fiasco a few years ago. The ubiquitous freeware firewall turned awry at a time when Windows PCs where transitioning from XP to Vista and the software's erratic behavior potentially brought the whole OS down with it.