There are so many fundamental differences between 1.1 and 3.5 that changing a big project that uses the former to use the latter is an enormous endeavor. It's possible, but depending on the size of the project you'll probably have to spend quite a lot of time changing almost every piece of code that uses basically anything from cocos2d. I once had to change a cocos2d 2.2 project to use 3.x, and that was a huge project in itself.
If you really want to do it, it might actually be best to just create a fresh new project and transfer source files and libraries from the old one to the new. While it's possible to plug cocos2d 3.5 into an existing project, it might be easier to just start a fresh project.
However, as already said, be warned that the amount of changes you'll need to do to your code in order to use cocos3d 3.5 will be rather substantial. Most probably almost every single line of code that uses the library in any way will probably have to be changed, and a few parts (such as configuring and launching cocos2d from your app delegate) will have to be rewritten completely.
Additionally, if your project is using cocos2d 1.1, I'm assuming it's written in non-ARC Objective-C. You might want to change your entire project to ARC, which in itself will require a bit of work (although compiler errors will relatively easily guide you to all the parts that need changing). cocos2d 3.5 itself uses ARC, and while it's possible to use an ARC library from non-ARC code, IIRC there are a few header files that won't compile as-is in a non-ARC project. Overall it might be just better to convert your entire project to use ARC.
All in all, it will be a rather huge endeavor.