Check the xf_user_upgrade_log table. Is there any record of the transaction? The record may contain a specific error message if there was a problem. If there is no record of the transaction then make sure the payment completed (in your paypal account). Also check these things:
1) Make sure your board URL is correct:
Admin CP -> Home -> Options -> Basic Board Information -> Board URL
2) Note that the paypal callbacks don't work if your forum is behind a htaccess login.
Or it's possible Paypal simply failed to send the callback. That happens sometimes in which case you can manually upgrade the user in the Admin CP.
And you need to ensure that you followed the instructions when listing the PayPal account in XF:
This is the primary email address on your PayPal account. If this is incorrect, payments may not be processed successfully. Note this must be a PayPal Premier or Business account and IPNs must be enabled. Please see our help.