I am trying to install a Software on Linux Server and while going into the directory and typing ./issetup, I am getting this error
Error: Can't open display

I have xserver installed on the Linux server, still seeing this error

Need help on how to resolve this and proceed with the installation.

Does this machine have a monitor connected?
How do you access to it, physically or remotely?

I access it remotely through putty and winscp
I have asked administrator to install Xserver so that GUI can be supported. I am new to Linux.
when I type xclock command, it displays clock so assuming xserver is properly installed

You need to provide more information. As a start:

Which software?
Which Linux version?
Is X running?
Are you doing this in a GUI environment?
What's the value of the DISPLAY variable?
What does the software's installation documentation say about the display?

EDIT: when you run xclock in the Putty window, where is the clock displayed?

This is complete error message I get
...
PuTTY X11 proxy: unable to connect to forwarded X server: Network error: Connection refused
Error: Can't open display: localhost:10.0

You need to tell us the whole story instead of coming up with bits and pieces of information one by one. Your original message left out that you were using putty with x11 forwarding on windows, that there were programs (xclock) that could be executed without problems, and the precise error message.

We still don't know what X server you using on which version of Windows, whether you ran xclock with the same display setting or a different one, whether you can run xclock in the exact same putty window where issetup fails and probably many other relevant details. To get gelp, you need to provide the background and all the details.

Googling for the error message yields a number of results which may or may not match your case, but only you can tell, because only you have the full information. Here is a possible solution for your problem, assuming that you use a specific version of the cygwin x server and a specific configuration: http://qandasys.info/putty-cygwinx-a...ction-refused/.