From aa.com:
Upgrades
Q. Can I use miles to upgrade any reservation through my travel agency or corporate travel desk?
A. At this time, you may use your AAdvantage miles to upgrade British Airways and Iberia flights as well as American Airlines codeshare flights operated by British Airways and Iberia which have been booked directly with American Airlines (via Reservations or AA.com).
However, British Airways and Iberia flights booked through other sources are not currently eligible for an upgrade using miles because of technical issues regarding systems compatibility. We hope that the inconvenience is more than offset by the opportunity to use AAdvantage miles to upgrade on British Airways and Iberia flights. We are working to expand upgrade opportunities to include to reservations booked through travel agencies and corporate travel desks. As always, you may use miles to upgrade American Airlines marketed and operated flights when booked through a travel agency or corporate travel desk.
Q. Can I use my miles to upgrade from discount Economy fares?
A. You can use miles and a co-pay to upgrade from discount Economy fares on American Airlines flights. However, upgrades on itineraries that include British Airways and Iberia are valid from full fares only.
Q. Why is my upgrade on British Airways valid from Economy to Premium Economy and not to Business?
A. Mileage upgrades are valid for a one cabin upgrade. On those flights where British Airways offers a Premium Economy cabin, upgrades from Economy are valid to Premium Economy. On flights where British Airways does not offer a Premium Economy cabin, the upgrade is valid from Economy to Business.
Q. What is "Premium Economy"?
A. Premium Economy is a separate class of seating and service that differs from standard Economy. Premium Economy is found mostly on international flights and, compared to standard Economy may offer additional legroom and amenities.
Q. When will a "From Economy to Premium Economy" vs. a "From Economy to Business" upgrade apply?
A. The award needed is based on the itinerary and the cabin configuration of the flights you wish to upgrade. If the longest flight segment you wish to upgrade has a Premium Economy cabin, the "From Economy to Premium Economy upgrade applies.
Q. Can I waitlist an upgrade using the AAdvantage Participating Airline upgrade award?
A. No. Flights cannot be waitlisted when using the AAdvantage Participating Airline upgrade.
Q. Is this new upgrade valid only on transatlantic routes?
A. The new upgrade is valid on any flight systemwide on American Airlines, British Airways and Iberia (except Iberia flights to/from Cuba due to government restrictions.)
Q. Why can't I upgrade on Iberia from Business to First?
A. Iberia offers Economy and Business class only. They do not offer a First Class cabin.
Q. Which AAdvantage participating airlines can I upgrade?
A. At this time, AAdvantage Participating Airlines Upgrade awards are valid on American Airlines, British Airways and Iberia and codeshare flights both marketed an operated by American Airlines, British Airways and Iberia.
Q. Can I upgrade on other AA codeshare flights operated by other airlines?
A. To be eligible to upgrade, the flight must be both marketed and operated by American Airlines, British Airways or Iberia. Flights operated by other airlines are not eligible to upgrade.
Q. Can I use my systemwide upgrades on British Airways and Iberia?
A. No, systemwide upgrades may only be used on American Airlines marketed and operated flights.