If you are using Windows 7, try clicking on the little sound/speaker icon on the right side of the task bar. Then click on "System Sounds," and see if you can change anything on your mic settings from there to get it to work...? Also, if you click on the "speakers" button you can change your mic levels, perhaps they are set low...? If you aren't using Windows 7, I suppose you'll still have similar options, just maybe not with those specific names. I have Audacity (1.3.12 Beta), but I don't see anywhere that you can mess around with the mic settings there (except the minimal volume controls)... if all else fails, maybe look around the control panel for potential solutions...?