When doing an upgrade installation, Firefox usually migrates settings automatically for you. However, 3.5 is quite an old version, so I don't know whether it will work on the first try, or whether you might have to upgrade in two steps: first to 3.6, and then to 17.

First, I suggest backing up your entire settings folder so you could restart the process if necessary. This article describes how to get to the folder; you could just make a copy outside the Mozilla path: Back up and restore information in Firefox profiles.

Second, you could export your bookmarks to an HTML file as an extra option. This file, too, should be saved in a safe place. Can you find the export feature in the Organize Bookmarks dialog? (Things may have moved around...)

Do those steps work?

Oh my god. Guys I’ve just discovered something interesting and I think it will help the Firefox users. I installed the Firefox newest version and when I opened it all my bookmarks were in the new version and I didn’t do anything. Your solution is correct but when you wants to I don’t know reinstalling the Windows or installing Firefox in your system for the first time but this is important to know: When you already have installed any version of Firefox and you want to upgrade or install a new version all your bookmarks will be import to the newest version and you don’t need to do anything. And that’s why I looooooooooooooooove Firefox to do everything for the users. Mozilla team I want to kiss you all Yeahhhhhhhhhhhhhhhhhh.