It's possible that you are having a problem with some Firefox add-on that is hindering your Firefox's normal behavior. Have you tried disabling all add-ons (just to check), to see if Firefox goes back to normal?

Whenever you have a problem with Firefox, whatever it is, you should make sure it's not caused by one (or more than one) of your installed add-ons, be it an extension, a theme or a plugin. To do that easily and cleanly, run Firefox in safe mode (don't forget to select Disable all add-ons when you start safe mode). If the problem disappears, you know it's from an add-on. Disable them all in normal mode, and enable them one at a time until you find the source of the problem. See this article for information about troubleshooting extensions and themes and this one for plugins.

If you need support for one of your add-ons, you'll have to contact its author.

If the problem does not disappear when all add-ons are disabled, please tell me, so we can work from there. Please have no fear of following my instructions to the line, as all can be easily undone.

A possible cause is security software (firewall) that blocks or restricts Firefox without informing you about that, possibly after detecting changes (update) to the Firefox program.
Remove all rules for Firefox from the permissions list in the firewall and let your firewall ask again for permission to get full unrestricted access to internet for Firefox.

See Server Not Found - Troubleshoot connection problems and Configure firewalls so that Firefox can access the Internet and http://kb.mozillazine.org/Firewalls

Thanks for the idea. However, not only did I try that but I also just shut off the firewall with no luck. Somewhere I ran across a program to search for "hidden" firewalls- and didnt have any--so I dont think it is the firewall. Any other ideas?

thanks

Thanks for the suggestion. Tried it in safe mode with disabled add ons and same result. Again I have played around with the firewall, the profile and even tried an uninstall and fresh install. Cant figure it out. Any other ideas? Thanks,

In Firefox 3.6.4 and later the default connection settings have been changed to "Use the system proxy settings".
See "Firefox connection settings" in Server Not Found - Troubleshoot connection problems

You can find the connection setting here: Tools > Options > Advanced : Network : Connection
If you do not need to use a proxy to connect to internet then select No Proxy

Thanks again. But I played around with the proxy settings, and this did not help either. I made sure that the settings were identical to another computer with the updated firefox that is working fine.