Start Firefox in Safe Mode to check if one of the extensions ("3-bar" menu button or Tools -> Add-ons -> Extensions) or if hardware acceleration is causing the problem.

• switch to the DEFAULT theme: "3-bar" menu button or Tools -> Add-ons -> Themes
• do NOT click the "Refresh Firefox" button on the Safe Mode start window

• https://support.mozilla.org/en-US/kb/troubleshoot-firefox-issues-using-safe-mode
• https://support.mozilla.org/en-US/kb/troubleshoot-extensions-themes-to-fix-problems

I tried every thing, but still the problem presists

Are you running Firefox in a sandboxed environment via a special program? Or is this Firefox one you use at work? It looks like it's locked down & makes me wonder if a group policy was applied to it.

I'm going to see if there's a policy that specifically disables downloads. If there is, we can have you check to see if it's enabled then disable it.

My other concern is if malware perhaps caused this. But it would be a very strange to do.

See also What to do if you can't download or save files for other possible solutions.

I am using Windows Defender as my anti virus and I think I received one popup once that showed ALLOW ACCESS to Firefox. I denied and downloads have stopped. I tried really hard to reset that, but unfortunately I couldn't.

It is normal that the Save button is disabled initially as a safety measure, but the Save button should be getting enabled in about one second. If that isn't happening then something else seems to be blocking the download.

Can you check the permissions for Firefox in Windows Defender and possibly remove them all for Firefox ?