If you start a voice chat instead of the video conversation, it will enable the sound.
The big step as mentioned in an earlier post is enabling the video.
In version 8.1 of messenger, you BOTH need to press the little camera icons below your profile pictures to enable the video (this is after the audio is connected)!
...... the normal video conversation only does video with no audio.
Try unticking "Click here if you are using headphone"... it worked for me
This is a known problem with messenger and Vista, and you can resolve it using this work around:
Start a voice call only; the sliders should then be active
Request the other persons webcam once voice is active.
When you can see their cam, send your own.