I need help, my macbook won't boot up

So I was on my macbook yesterday and everything was working fine. The system told me there were a couple of upgrades to be installed so I agreed. the latest itunes, Quicktime and osx (internet) or something like that.

The applications began to DL and install and then the 3rd (osx internet) said there was error and could not be installed. So then it asked me to restart my computer so I did. It didn't restart because LimeWire was active so I ForceQuit Limewire and then simply closed my macbook.

I then opened the macbook and nothing. I hit the power button and held it until it turned on. Now the macbook is stuck on the gray screen with the apple logo and the spinning progression wheel. The only 2 disks I have are the osx install 1 and 2 discs. It was a hand-me-down so im not sure if they just forgot to give me anything else, i.e. RECOVERY disc.

Anyway, I have no warranty on it.

I tried starting in safe mode (single user mode) and it brings me to a DOS like page. Although I can't type anything on the page. I tried resetting the PRAM and it does nothing.

What else can I do? I did nothing out of the ordinary and this thing shut down. The first time this happened it just powered up and rebooted, but I lost my iTunes library and all my pics in iPhoto. I've had my macbook about 3 months and so far it hasn't been a good experience.

put the apple osx disk in the cdrom, and hold "alt/opt" down when you boot, select the cd


when it finally opens, click on UTILITIES somewhere in the menu, and disk utility, repair permissions, and check disk

Thank you. I'll give that a try. Is there anything else I need to do after that? Or does the cpu do it on its own? Any codes I need to input?