Did you “update” OS X?
Quit Audacity.
In Finder, Go > Go to Folder and type:
~/Library/Application Support/audacity/
Open audacity.cfg in Text Edit and remove all the content then add
NewPrefsInitialized=1
Save audacity.cfg.
Follow the steps here:
http://manual.audacityteam.org/o/man/faq_installation_and_plug_ins.html#maclame_zip
to download the zip of LAME, extract the libmp3lame.dylib file somewhere other than /usr/local then locate that file in Audacity’s Libraries Preferences. You could instead extract the libmp3lame.dylib into the same folder that you run Audacity from. Audacity should then see LAME without you having to locate it.
Gale