Please advice, need upgrade.

^^ with a 3.5 Ghz dual core you won't see much improvement from an i3 really. It has better instructions per clock, but the core speed is not OCable. Say it is a 20% ipc efficiency increase you are talking 3.7-3.8Ghz equivalent for a core2 series for the BEST i3.

Not a big gain. And of course the i3 is also just a dual core. I agree that on a tight budget you should be looking for an AMD solution. One that overclocks. Get the extra cores in.

I don't know why exactly you feel your CPU is holding you back... what from? encoding? That need more CPU cores. Gaming, that needs better GPU. System Response? That needs an SSD.

Well, generally gaming. I don't feel the need for a better GPU to do that and my budget is a little thin, I also feel that my MB is not that good so if I am going to change it I will need to get a new CPU too, I played a lot of games that are quite GFX wise demanding and my card pulled through them, I only get to wait for loading the game, the new map loading while in game, between checkpoints, maybe my hard drive too needs to be replaced, I am not really happy with my CPU OC because of the low performance form my MB.

OK. Well, then upgrade to i3 3220 + Z77 Mobo.
Or, if you want to overclock, then go with AMD FX 6300.
Both the CPUs will provide you similar gaming performance and nearly at same price.
But, if you can extend your CPU budget further, to get an i5 3570k (or at least 3470), then you'll see a significant increase in performance.
i5 3570k is selling hot these days, as it provides unmatched value for money and excellent performance in Gaming.

I agree with the above poster. Personally on a tight budget you get a bit more for your money with the AMD setup. The 3570k is undisputedly better, but is definitely more expensive.

Thank you so much, I really appreciate the help.

First I want you guys to know that I am form Egypt, Cairo. Our market is a bit limited I can't always find the stuff you recommend but I can always find the equivalent and if to buy online the stores won't ship to Egypt   but our online stores are http://www.egprices.com/category.php?cat=1 and http://www.compume.com/index.php?dispatch=categories.vi... they are good and they have some high end gear but not all, I like the idea of an i3 with an H77 MB, a Z77 will be more money + an i5 its going to be much, which I prefer to use in a new computer from A to Z not for upgrade on the current gear, an AMD is not a cool choice for me I tend to sell my old gear every upgrade and our used market just don't understand AMD so I will be stuck with them till they die  

So here what I think will be good for now an i3 2120 because its the highest one we have at our stores, as for the H77 I will go with the Gigabyte GA-H77-D3H its more money but fine it Supports 3rd Gen 22nm CPUs and 2nd Gen CPUs (LGA1155 socket) which is great, but if my cash is not enough I will go with Gigabyte GA-P61A-D3 its much cheaper which can give me a chance to get a new hard drive.

Yes 2120 is a very good choice. 3220 is just 10% faster than it. Yes, if you can't afford H77, a good H61 Mobo will also work fine, with fixed clock i3s.

Hey, I made some search on the stuff you guys told me about and here is what I found and I guess this will by my upgrade.
As for the CPU I will go with the i3 3220 Ivy Bridge   it was launched in our stores 2 days ago and its not more money than the i3 2120 Sandy Bridge and why not a 3rd Gen CPU?!!, as for the motherboard I went for an ASUS P8H77-M LE I am not a fan of the uATX mother boards but I don't need any extra pci's (only one for my wireless Desktop Adapter) and no SLI or CrossFire for me (not a fan of both) it has everything I need also I can upgrade without changing it too. So what do you think guys?!! moreover I will not be spending a lot of cash, maybe round 250$ which is great and I will try to add a new hard drive later, I hope these new stuff will be good for my gaming needs for the time being  

Thank you again for the info, please advise on the CPU and MB.

Best answer selected by Dfox79.