Answer by shane for How to get Readline support in IRB using RVM on Ubuntu 11.10

I had the same issue but I'm on 11.04 and from reading the link you gave https://github.com/wayneeseguin/rvm/issues/553and from the info in peplins comment there I removed the autoreconf call that was added here
https://github.com/wayneeseguin/rvm/commit/94c301dand now readline compiles without any errors. I added back in the autoreconf call after I had compiled readline before installing ruby again.

So this is how I got it work:

edit ~/.rvm/scripts/functions/pkg and delete the following:

if [[ "${rvm_skip_autoreconf_flag:-0}" == 0 ]] &&  which autoreconf >/dev/null 2>&1 &&  which libtoolize >/dev/null 2>&1 &&  [[ -f configure.ac || -f configure.in ]]then__rvm_run "$package/autoreconf" \"autoreconf -is --force" \"Prepare $package in $rvm_src_path/$package-$version."fi

Compile readline and remove ruby (I used the ree_dependencies command but I'm not sure this is necessary):

rvm pkg install ree_dependenciesrvm remove 1.9.2

undo your deletion to ~/.rvm/scripts/functions/pkg
I then installed 1.9.2 with this command (again it's from the ree install which I'm not sure is necessary but this is what I used)

rvm install 1.9.2 --with-readline-dir=$rvm_usr_path --with-iconv-dir=$rvm_usr_path --with-zlib-dir=$rvm_usr_path --with-openssl-dir=$rvm_usr_path

and now all appears to work as it should, hope that helps someone.