If you are reading this because recordings have always worked fine in the past but are now recording incorrectly, or because an input is missing or Audacity is no longer launching properly, an automatic update via Windows Update may just possibly have caused the problem. Windows Update is potentially less reliable about obtaining appropriate hardware updates than Windows Device Manager.
If you suspect a driver update problem, launch Device Manager from the Windows Control Panel. Expand "Sound, video and game controllers" by clicking on the arrow, then right-click over your sound device and choose Properties. Click on the "Driver" tab to check the driver provider, date and version. If an update has occurred at any time, the Roll Back Driver button will be active. You can click this button to revert the driver to its previous installation. You can also view a video of the rollback process on Windows Vista and Windows 7.
If rolling back does not help or makes matters worse, go back to the "Driver" tab and click "Update Driver". After the update, check the Driver Provider again. If the driver provider is now Microsoft you could see if your problem is resolved, but the general recommendation would be to visit the website of the computer or motherboard manufacturer and look for appropriate drivers specific to your computer model and version of Windows.
For future, consider verifying updates via Windows Update manually instead of allowing updates to proceed automatically.