Uploading file using asynchronous postback in Ajax update panel control is not possible because file manipulation and file uploading is restricted in client side due to security reasons. File upload control inside Ajax update panel control will not work with partial postback because upload control needs to full page post back. File upload control always need to post full postback.Update Panel Triggers are allows us to post full postback and partial postback.

Open Visual Studio 2010 and select File > New Web Site (Shift + Alt +N )  > ASP.NET Web Application.

    <asp:ScriptManager ID="ScriptManager1" runat="server" />
    <h2>
        File Upload Control within Upload Panel control using asp.net
    </h2>

    <p>
        <asp:UpdatePanel ID="UpdatePanel1" runat="server" UpdateMode="conditional">
            <Triggers>
                <asp:PostBackTrigger ControlID="btUpload" />
            </Triggers>
            <ContentTemplate>
                <asp:FileUpload ID="FileUpload1" runat="server" />
                <asp:Button ID="btUpload" runat="server" Text="Upload" OnClick="btUpload_Click" />
                <asp:Label ID="lMsg" runat="server" />
            </ContentTemplate>
        </asp:UpdatePanel>

    </p>

 Open the code behind file and add the following code:

C#

protected void btUpload_Click(object sender, EventArgs e)

    {

        try

        {

            if (FileUpload1.HasFile)

            {

                string filename = System.IO.Path.GetFileName(FileUpload1.FileName);

                FileUpload1.SaveAs(Server.MapPath("~/Files/" + filename));

                lMsg.ForeColor = System.Drawing.Color.Green;

                lMsg.Text = "File uploaded successfully.";

            }

        }

        catch (Exception ex)

        {

            lMsg.ForeColor = System.Drawing.Color.Red;

            lMsg.Text = "Error:" + ex.Message.ToString();

        }

    }

VB.NET

   Protected Sub btUpload_Click(ByVal sender As Object, ByVal e As EventArgs)

        Try

            If FileUpload1.HasFile Then

                Dim filename As String = System.IO.Path.GetFileName(FileUpload1.FileName)

                FileUpload1.SaveAs(Server.MapPath("~/Files/" + filename))

                lMsg.ForeColor = System.Drawing.Color.Green

                lMsg.Text = "File uploaded successfully."

            End If

        Catch ex As Exception

            lMsg.ForeColor = System.Drawing.Color.Red

            lMsg.Text = "Error:" + ex.Message.ToString()

        End Try

    End Sub