RHEL5 is packaged with ruby 1.8.5 which is now outdated. To replace it with REE:
rpm -e `rpm -qa|grep ruby` # remove outdated ruby packages
sudo yum install wget -y
sudo yum install gcc-c++ make patch zlib-devel -y
sudo yum install openssl-devel readline-devel -y
cd /tmp
wget http://rubyenterpriseedition.googlecode.com/files/ruby-enterprise-1.8.7-2011.03.tar.gz
tar xzvf ruby-enterprise-1.8.7-2011.03.tar.gz
sudo ./ruby-enterprise-1.8.7-2011.03/installer --dont-install-useful-gems --auto=/opt/ruby-enterprise
cat > /etc/profile.d/ruby-enterprise.sh <<EOF
if ! echo ${PATH} | /bin/grep -q /opt/ruby-enterprise/bin ; then
PATH=/opt/ruby-enterprise/bin:${PATH}
fi
EOF
. /etc/profile.d/ruby-enterprise.sh