Is this gonna work for up to 1000 users? Having an update panel for specific HTML controls(MySQL database, select statements checking update in the database), just a small part that kept being refresh for 1 second or 500ms? Will it greatly affect the performance? I am using web forms in asp.net
You should never use an UpdatePanel if you are frequently refreshing the data and you got a server that does not support this many requests especially when you have thousands of users making requests, all hitting the same database and imagine if your select statements are not very well managed, and you have millions of records in your table that your select statement is filtering out each second for thousands of users. It could cause huge performance lags.
So, Yes, it will widely affect the performance.
Instead, move towards event driven approaches that only send you data when there is a change in the database, i.e when there is a notification in real time, such as SignalR and SqlDependency. This will be a lengthy thing to do but it will be a big plus in the performance of your application.
Otherwise, you can always move towards intelligent refreshing techniques such as hitting the server when the user is on page and the tab is focused. In that case, using jQuery ajax would be very beneficial.
So, to summarize it, you should not use UpdatePanel and refresh every second or every half second this will cause problems on a long run.