Android Installation error: “Couldn’t install on USB storage or SD card"

I started receiving installation errors on my recently purchased Android phone which wouldn’t allow me to install some apps on my phone nor let me update others. Other applications, however, installed normally.

I even contacted Android market regarding this but they didn't succeed in providing a permanent solution. So I recently googled it, and found a number of solutions.
Here's one of them for you,
I hope this saves you some time, as this has been extremely frustrating and time consuming problem to track down for me.!

The problem turns out to be a temporary file “smdl2tmp1” that is created by some applications during the installation process. If the installation gets interrupted, the temporary file does not get deleted properly. The next time the installation runs it can’t create the file and instead gives the installation error. This bug may have already been addressed in Gingerbread but that is unconfirmed.

The solution provided by Artem Russakovskii at Android Police is to manually delete the “smdl2temp1” file. The file is likely to reside in 2 locations:

1. /sdcard/.android_secure: this is an invisible folder on your SD card, which you can access with any file manager, like ASTRO

2. /mnt/secure/asec/: access to this folder requires root and a program like Root Explorer

Note:
I couldn’t delete the file directly from my phone using a file manager including “Astro.” My phone would see the hidden folder but did not see the “smdl2tmp1” file, which was also hidden. My solution was to mount my phone via USB and navigate to the folder and delete the file from my PC.
Once the file was deleted, everything was back to normal with application installs and updates.

P.S : This Is just a forwarded solution, intended only for quick reading and is not liable for any copywrite claims.