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Upgrades, like the name suggests, improve a particular Awesomenaut's abilities and/or autoattack. Every Awesomenaut has 24 upgrades, split into 4 different rows (with 6 on each one). Upgrades cost Solar and are purchased from the Shop.
The upgrades in the first 2 rows improve the 'nauts' two abilities while the ones on the third row improve their autoattack. These are always unique upgrades, accessible only to that specific character.
The fourth row (often called "utility row") however, has generic upgrades available to many different 'nauts, although some exceptions do occur. A player can only select 3 upgrades per row (for a total of 12) each game.
A particular set of upgrades is called a "Loadout".