Is it possible to upgrade from ios 4.3.5 to 5.0.1 even though the current version is 5.1?

Solution 1:

Actually, you don't even have to hunt it to a Bittorent. You can just download it from the Apple servers by visiting the RedMondPie website. Links are listed below the page.

Solution 2:

If you have the download, it's possible, but as you don't you will likely have to hunt it down on Bittorrent, at which point you are in your own, but in essence you can apply any version you have got the file for so long as you are upgrading, downgrading will not work

The file was originally hosted here but the actual download link has been removed. Apple only keep the most current versions available to download, so you will have to hunt a copy down and I am not able to assist in that (although if you know someone who has already used that level more than once then rifling through there Time Machine backups or iTunes folders may yield results. Actually, as indicated in @michiel's answer, the links remain, they are just hard to find, so if you can find a list like the one maintained here you are good to go.

To perform the upgrade once you have the file, and to stop iTunes simply checking for the most recent update and offering to apply that, you should select your iPhone in the connected device list after connecting by USB, go to the summary tab, check in the versions section. Instead of just clicking update, hold the option key down and then click. You will now be offered a finder style file picker to allow you to point it at your downloaded file. Selecting this will allow you to upgrade to your choice of OS.

NOTE: Perform a full backup of your phone before doing any upgrade. NOTE: I am not able to explain why you cannot back level in the same manner, it's something to do with baseband and I don't understand why.