Three possibilities
1) You haven't installed it into the socket all the way
- You angle the RAM module at about 30 degrees to put the contact-edge into the socket. While the RAM is at the 30 degree angle still, push with both thumbs on the top edge of the RAM to ensure that the pins are seated completely into the socket. THEN lay it down to the horizontal position. if you can see more than 1 mm / 1/32 inch of contacts, then you haven't got it in completely.
2) The RAM you installed is defective - if the fault follows the RAM chip (see #3 below) then send it back for a replacement.
3) Your machine may have fallen prey to the "Lower Socket failure syndrome.
Back up your data before you do anything.
- take your known good RAM and put it in the lower RAM socket. Is it recognized? Put your new RAM inthe upper socket. Is it recognized?
If both modules work in the upper socket, and neither work in the lower socket, then the lower socket on the motherboard has failed. This is a known syndrome, Apple has not yet acknowledged a manufacturing flaw, it seems to be associated with upgrading to OS 10.3.9 or 10.4.... although if you have never had RAM in the lower socket, you hay have had the problem for some time. If your machine is still under optional 3 year Applecare, get it in to Apple ASAP for a new logic board. If it is out of warranty, send the 512 Mb RAM module back and trade it in for a 1 Gb. Put the 1 gb module in the upper socket and call it a day.
Thanks
Trevor
CanadaRAM.com