I've had the game installed for just a couple of days now and I've have had no major problems, until today.

For some reason when I speak to NPCs, the Speech volume becomes so low that I cant make out whats being said. The peculiar thing is that if I turn my camera angle so that I'm facing away from the NPC, the volume gets higher and higher the further away I look?

This Bug only seems to be affecting NPCs I have directly engaged in conversation, the random indirect dialogue you get from passing random NPCs is at normal volume regardless of my camera angle.

Its driving me insane! I havent messed with any audio options and cant figure out whats caused the problem, I have tried rebooting, reloading an earlier save, and even went as far as to reinstall the game from scratch, all with no luck.

Anyone encountered a similar bug, or have any suggestions? It seems like Skyrim is trying to run in surround sound now, even though I dont have a surround sound set up, nor have I altered any sound options.

It seems that using Headphones is to blame. After hours of unsuccessfully searching through various forum posts for some kind of fix, I noticed that most people affected by the bug were using headphones rather than their speakers (My PC is in the living room, so I'm limited to headphones a lot of the time).

Simply unplugging them and restarting the game fixed the problem. If I plugged in my headphones again after that, the sound will work correctly for a minute or so and then revert back to the glitch.

Anyway thought I'd mention it incase anyone else is affected and unable to fix it. Looks like I'll have to limit my Skyrim playtime to when the familiy are all at work from now on (Good job my days off are Monday and Tuesday rather than weekend )

Do you have surround sound?
If so you may find it's something to do with your centre channel. Same thing happens to me if I have the headphones plugged in the surround sound unit. If I plug them directly into the headphone out on the PC itself it doesn't happen.

What kind of speaker/sound setup do you have?
Skyrim is known to detect sound setups in the wrong way. I for example have normal 2-way stereo speakers and sound is also set up that way in Windows. But when I leave it that way, I miss a lot of sounds because Skyrim is trying to play at channels which I don't have. Only when I fool Skyrim by setting my sound in Windows to 5.1 Surround, then I hear everything. It's a well known bug in Skyrim, that whole sound issue

Also, it differs if you use onboard sound (so from your motherboard) or if you use a soundcard. I use to use my onboard sound and sound was terrible (although in EVERY other application/game my sound was just fine). I did buy a simple Soundblaster and behold, suddenly Skyrim was fine (with 5.1 setting in Windows instead of 2.0).