IPhone update saying continuing all media will be lost?

OK, on my iPhone 3gs i have an update for 5.1.1 so i backed up all my apps and everything, then in the middle of updating it says "this computer doesn't have enough memory and continuing all media will be lost" and i was like i don't want to loose everything so i canceled. Now my question is can i still update and they take all my media off but since i have it backed up in my itunes i can just put it back on there or will it take it off my itunes too?

Yeah. Just re download it off of your computer if you are confident you have everything

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