What should be upgraded in a 4L60E rebuild?

Fix the known weak points first, then control heat.

The upgrades that matter (Speedway):

• 3–4 clutch pack: stronger frictions and steels — one of the most common failure points.
• Hardened input shaft: keeps it from twisting or breaking with hard launches or sticky tires.
• Sun shell: a beefed-up shell.
• Valve body / shift kit: firmer shifts cut clutch slip and heat.
• Torque converter: stall matched to the cam and powerband; for high torque, one with an anti-ballooning plate.
• A large external cooler: heat is what kills these.
• Tuning: shift timing and line pressure calibrated for the build.

With those, Speedway says a street-friendly build can reliably handle about 450–500 hp, and more aggressive builds can go past 600 hp.

What fails, in order: heat first — once the fluid breaks down the clutches follow quickly. Then the 3–4 clutch pack, and the sun (reaction) shell, which takes out 2nd, 4th and reverse when it lets go. Heavy vehicles, towing, sticky tires and poor tuning all speed that up.