I am using XeLaTeX in TeX Live suites 2010 and everything was going well before I did an upgrade via TeX Live Manager minutes ago. Now every document I compile gets a "File not found" error as the title suggests. But actually fontspec.sty is lying well under texlive\2010\tex\latex\fontspec so I don't understand why it complains about that.
Does anyone have the same situation?

sudo texhashat the Terminal and see if that helps (it rebuilds the file database). – Joseph Wright♦ Mar 26 '11 at 13:43