Ouch, that's not good... There's a couple of possibilities.
1- the installer applications is corrupted. It's in /Applications/Utilities/ You can try to replace that with one from another machine..
2- Something to do with your account. Make a new admin account and try it again logged in as that user.
3- Someone screwed with the sudoers file- It's in /etc/sudoers. I'm not totally sure that the installer cares about that file, but it may... It looks like the following by default.
#########################################
# sudoers file.
#
# This file MUST be edited with the 'visudo' command as root.
#
# See the sudoers man page for the details on how to write a sudoers file.
#
# Host alias specification
# User alias specification
# Cmnd alias specification
# User privilege specification
root ALL=(ALL) ALL
%admin ALL=(ALL) ALL
#########################################
3- Your NetInfo database is corrupted. If that's true, you should also have problems creating new accounts and loggin in. I'm guess that's not true though our you would have mentioned it....
Hope one of these helps...
-todd-