Install failed due to hard drive issue -- now can't start Mac

I downloaded and installed Mountain Lion, but about 5 minutes into the install it said it couldn't do it because of a hard drive failure. It then told me to restart and try again, which I did. It failed again for the same reason. This time I quit the installer and restarted. Now my Mac won't start up -- it gets caught on that first screen with the spinning icon.
How can I get my Mac back up and running?

Hi David,
I am so sorry I could not post this earlier. It's too bad you replaced your drive. I hope you have not lost important data through this ordeal!
I also went to the Apple Store yesterday (as I am covered under Apple Care) and had a consultation with a 'genius' who very quickly concluded that I either had a faulty hard drive (which I knew was not the case) or the ENTIRE contents of my primary hard drive were corrupted. According to him, my only choice would be to reformat and re-install from scratch. I was also chastised for not backing up my data before attempting to upgrade to Mountain Lion. He was also very persistent in asking (multiple times) if I "understood technology". I was dismissed with the excuse that there were other people waiting for him and he could not waste his time on me - he actually said that while walking away... The store manager offered to direct my to a couple of companies near-by that would be able (for a hefty fee) to restore my data.
Anyways, this was not necessary. Despite the "corrupted data" error messages and the fact that the drive would not initially mount, the solution to the problem proved to be simple and my visit to Apple Store completely pointless.
This is what worked for me:
-- Use/borrow/buy (from Apple Store and then return for a refund) an external hard drive with firewire connectivity. The drive should have a fresh partition that you can erase and format as Mac OS Extended (Journalled) in Disk Utility.
-- Connect your mac to the Internet, preferably over Ethernet.
-- Restart the computer while holding the option key, select the Recovery Partition and begin the installation (in my case of Lion) by selecting to install on the freshly-created partition of the external hard drive.
-- Once that is done, you can actual start OS from the fresh partition by again holding the Option key at startup. In my case, as the drive was indeed healthy, it mounted without issues and I was able to simply copy->paste ALL my data (which the 'genius' insisted was corrupted and forever lost) on a separate drive.
-- After you back everything up, start up Disk Utility, erase and reformat the primary partition on your Mac (where you want the OS to be ultimately installed on) and repeat the installation process once again.
Regards,
Lena

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