RotateSpriteTowardsMouse.cs

// Rotate sprite/object towards mouse : http://johnstejskal.com/wp/rotating-objects-and-sprites-in-unity3d-using-cs-c/

using UnityEngine;
using System.Collections;

public class RotateSpriteTowardsMouse : MonoBehaviour 
{

	private Camera cam;

	void Start () 
	{
		cam = Camera.main;
	}
	

	void Update () 
	{
		Vector3 mousePos = cam.ScreenToWorldPoint(Input.mousePosition);
		
		// rotate Y (green axis) towards mouse
		//transform.rotation = Quaternion.LookRotation(Vector3.forward, mousePos - transform.position);

		// rotate Y (green axis) away from mouse
		//transform.rotation = Quaternion.LookRotation(Vector3.forward, transform.position-mousePos);

		// rotate X (red axis) towards mouse
		Vector3 perpendicular = Vector3.Cross(transform.position-mousePos,Vector3.forward);
		transform.rotation = Quaternion.LookRotation(Vector3.forward, perpendicular);

		// rotate X (red axis) away from mouse
		//Vector3 perpendicular = Vector3.Cross(mousePos-transform.position,Vector3.forward);
		//transform.rotation = Quaternion.LookRotation(Vector3.forward, perpendicular);
	}
}