A system and method for firmware upgrade in an AMI are provided. A remote server provides a firmware image file. After receiving the firmware image file and verifying the remote server, a data concentrator transmits at least one encoding symbol generated from the firmware image file to at least one meter through broadcasting and a retransmission mechanism of minimum retransmission contents. Upon receiving a predetermined number of encoding symbols, each meter recovers the original firmware image file from the received encoding symbols. Then, each meter receives and verifies an activation code generated by the remote server before carrying out the firmware upgrade.