Upgrading is one of the ways to increase a Weapon/Armour/Accessory's stats. Upgrading a item increases its Level or Lv. To increase a weapon's Max Lv, see Evolve Fusion.
Upgrading requires a material/item and 320 poro per material/item used. The material/item that gives the most experience are the Forged Sword/Mail and Upgrade material. Both share the same icon but Forged Sword/Mail take up inventory space while Upgrade material are stored as material. Upgrade materials are easily farm-able from the Rushmere continent. Due to how the Forged Sword/Mail take up space, it is recommended to use up all of those before using the material.
By tapping on the fusion menu in the [Equip. Upgrade] tab and then the Upgrade/Skill/Evolve Fusion tab, it will show you a list of all items that is possible to rank up.
Simply scroll down to the item that you want upgrade and select it. Once in the upgrade screen, tap the upgrade items/materials you want to use to upgrade your item.
The amount of stat increase differs per weapon and its rarity. Upon reaching lv thresholds at 70, 90, 115 (and more) you will gain a stat increase and a special effect. Both effects are increased slightly per threshold passed.
There is a limit on how many items/materials you can use in one upgrade which is 20 material and 10 items which adds up to be 30 in total.