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In order to manage the feat of multiple Rubies, the amazing Ruby Version Manager (rvm) by Wayne Seguin is simply essential. Here are the steps I followed:

After installing rvm, I first tried to install the latest version of Ruby 1.8.7, which works with both Rails 2 and Rails 3:

$ rvm install 1.8.7

At this point I got a readline error, but this was covered by the rvm troubleshooting guide:

$ rvm remove 1.8.7; rvm install readline

Unfortunately, the installation still fails to build a makefile:

$ rvm install 1.8.7
.
.
.
FAIL
$ less ~/.rvm/log/ruby-1.8.7-p249/make.error.log

[2010-02-12 08:54:30] make
make: *** No targets specified and no makefile found.  Stop.

After searching around for a while, I finally found a page (location already forgotten) with the fix, which involves including an explicit path to the readline dependency:

$ rvm remove 1.8.7
$ rvm install 1.8.7 -C --with-readline-dir=/Users/mhartl/.rvm/usr

This still didn’t work, though; on my system (OS X 10.5 Leopard) I got a segfault, which shows up when installing certain gems:

$ gem install metric_fu

/Users/mhartl/.rvm/rubies/ruby-1.8.7-p249/lib/ruby/site_ruby/1.8/rubygems/
spec_fetcher.rb:245: [BUG] Segmentation fault
ruby 1.8.7 (2010-01-10 patchlevel 249) [i686-darwin9.8.0]

Abort trap

Luckily, I have a working Ruby 1.8.7 in /usr/local/bin, so I could check the patchlevel: p174. Since rvm installs the latest version by default (1.8.7-p249 as of this writing), I had to indicate the patchlevel explicitly:

$ rvm remove 1.8.7
$ rvm install 1.8.7-p174 -C --with-readline-dir=/Users/mhartl/.rvm/usr

(Note that this also requires the explicit readline path.)

Finally, I had a working Ruby, but I wanted to set the rvm Ruby as the default, and my system wouldn’t remember it:

$ rvm 1.8.7-p174 --default
$ which ruby
/Users/mhartl/.rvm/rubies/ruby-1.8.7-p174/bin/ruby
new shell...
$ which ruby
/usr/local/bin/ruby

The solution was to remove the explicit /usr/local/bin path from my .bash_profile file:

before:
  export PATH="/usr/local/bin:$HOME/bin:/usr/local/mysql/bin:$PATH"
  if [[ -s /Users/mhartl/.rvm/scripts/rvm ]] ; then source /Users/mhartl/.rvm/scripts/rvm ; fi

after:
  export PATH="$HOME/bin:/usr/local/mysql/bin:$PATH"
  if [[ -s /Users/mhartl/.rvm/scripts/rvm ]] ; then source /Users/mhartl/.rvm/scripts/rvm ; fi

Wayne Seguin assures me that this step should be unnecessary as long as the PATH appears before the rvm line, but this is the only way I could get it to work on my system. (Since /usr/local/bin is on the system path, all the executables there still run; I’m not sure why I ever included it in .bash_profile in the first place.)

Finally, we’re ready for the raison d’être of all this work: multiple Rubies, multiple Rails. Here’s how to get it working (note the lack of sudo in the gem installations):

$ rvm use 1.8.7
$ gem install rails -v 2.3.5
$ rvm install 1.9.2
$ rvm use 1.9.2
$ gem install rails --pre

Voilà! Now switching between Rails versions is as easy as

$ rvm use 1.8.7

and

$ rvm use 1.9.2