I've found that the speakers on my 2008 Core 2 Duo MacBook aren't being used by Mac OS X. Some applications such as Skype that output directly to the speakers work, but the system (and any apps that use the system setting) are mute.
Before you recommend blowing in the headphone jack, there is no red LED and there is nothing there. If I can hear Skype clearly through the internal speakers, it's not the headphone jack.
Running Mac OS X 10.7.5 Lion as non-root administrator user.
Model identifier: MacBook4,1
Output device is internal speakers. I can hear the startup chime as well.
Best Answer
If applications can still send sound to your speakers but the system does not, it sounds like your default output device is something other than your speakers. Hold down the Option key and click on the volume icon in your Menu Bar (or go to System Preferences > Sound > Output). Under "Output Device:" select the device you want to use, probably "Internal Speakers." Make sure your volume is up, then try playing a sound again.