You need to enter your Heroes Altar. You should see all your heroes there. Any hero with a sparkling star means they are ready for upgrading. Click on the hero, there should be a sparkling 'Upgrade' link. When you click on 'Upgrade' you can see how much it costs to upgrade your hero. The costs is gold, HB, and flames requirement (from doing dungeons).
FYI, only upgrade legendary or your strongest elite heroes.