After updating to OS X Yosemite, brew breaks. When I run brew, it shows error:

/usr/local/bin/brew: /usr/local/Library/brew.rb: /System/Library/Frameworks/Ruby.framework/Versions/1.8/usr/bin/ruby: bad interpreter: No such file or directory
/usr/local/bin/brew: line 21: /usr/local/Library/brew.rb: Undefined error: 0

OS X Yosemite comes with ruby 2.0 bundled but Homebrew is designed to work with ruby 1.8.x. So this error can be fixed in the following steps:

   1) Open terminal
   2) nano /usr/local/Library/brew.rb
   3) In the first line change “1.8″ to “current”, so it should look like this: 
   #!/System/Library/Frameworks/Ruby.framework/Versions/current/usr/bin/ruby -W0

Note: Although above steps get Homebrew works again on Yosemite, Homebrew can not be updated. When running "brew update" command, it complains that 

   error: Your local changes to the following files would be overwritten by merge:
   Library/brew.rb
   Please, commit your changes or stash them before you can merge.

 A more simple way to get Homebrew work on Yosemite is to create a symbolic link
   "/System/Library/Frameworks/Ruby.framework/Versions/1.8"  linked to
   "/System/Library/Frameworks/Ruby.framework/Versions/2.0"
by using command
   sudo ln -s /System/Library/Frameworks/Ruby.framework/Versions/2.0
   /System/Library/Frameworks/Ruby.framework/Versions/1.8

At this time, you should be able to update brew, and then delete the symbolic link.