After moving my site to Linode, I encountered issue with WordPress not being able to create directory for both new plugin installation and update. I guest everyone encounter this issue once when using a VPS or cloud hosting. This article shows my steps to fix this issue.
Here is how the error looks like:


Change ownership of site web directory to web server
[xml]
chown -R www-data:www-data /var/www/html
[/xml]
/var/www/html folder is where I store my website. You can change it to where your web site is stored.
Set wp-content directory permission
Permission can be set easily with this command line.
[xml]
sudo find /var/www/html/wp-content -type d -exec chmod 775 {} \;
[/xml]
If you are using FTP client like FileZilla, just right-click on wp-content folder and choose “File permissions…” to set chmod.