If you are installing Magento and you have uploaded your Magento files to your host and just when you are about to run the Installation wizard, you get “500 Internal Server Error”. This error is because of the inappropriate file permissions.
To fix this error, if you are on cpanel hosting, Error Log will really help solving/fixing this error.
Normally changing the file permission on index.php file will solve this problem. If you check the error log in your cpanel, you will find “/index.php” is writeable by group
So in your cpanel, go to File Manager and then change the file permission of index.php file from 664 to 644. Also change the permissions of downloader/index.php file to 644 as well otherwise when you will try to access System > Magento Connect >Magento Connect Manager (after magento installation) by logging to magento admin, you will get 500 Internal Server Error.
And if magento is installed in a folder e.g yourdomain.com/magento, in this case you will also change the permission on magento folder to 644.