Well i came across this article and found it helpful so sharing with you all. I rip it off from some other site.
Removing Hiss with Audacity
I've tried various tools to remove hiss (or noise) from home recordings and I think Audacity has the best noise removal tool of all. While most other software packages use a noise gate to remove unwanted noise, Audacity goes about it differently.
I won't launch into how the techniques differ but I shall say this, Audacity's tool is far superior to any other I've tried. The end result is noise removal not only from "gaps" (the parts where the recording is supposed to be silent, like spaces between sentences and paragraphs) but also from spoken parts.
Let's say there's a constant hiss in a recording. That hiss will be audible even "below" the spoken parts of the recording (you'll hear the hiss when you're saying something too). Noise gates remove the hiss from the gaps but the hiss will still be audible in the spoken parts. Not so with Audacity's Noise Removal tool. If you use Audacity to remove noise you'll have no hiss throughout the recording.
Here's how to remove hiss (noise) from a recording:
Open a pre-recorded file or record your piece.
Click-drag a "gap" (part where there was nothing being said - the beginning of a recording usually has a gap) to select it:
This is a sample of the noise or hiss that you want Audacity to remove.
Next, go to Effect--> Noise Removal
Select that and you'll get the following dialog box:
Click the "Get Noise Profile" button. This tells Audacity that what was selected is noise that you want removed from the recording.
You'll be taken back to the wave form of your recording. Hit Ctrl+A (keeping the Ctrl key pressed, hit A) to select the entire recording. Your recording should look a bit like this:
Go to Effect--> Noise Removal again
Move the slider to the left so it's positioned about halfway between the start and its current position:
Next, hit the "Preview" button in the dialog box:
Listen to the preview. If there's still noise (99.99% of the time there won't be) move the slider to the right. If there's distortion of the voice move the slider to the left. (If there's noise AND distortion have your sound card and microphone checked by your hardware guy).
When you're satisfied that the noise has been removed without distorting the voice hit the "Remove Noise" button. You'll get the following message:
You'll then be taken back to the wave form view (you'll notice that the recording looks much cleaner, in the sense the jagged waveforms in the gaps have given way to flat lines). Listen to the ENTIRE recording and check for distortion in the voice. If there is any distortion hit CTRL+Z (holding down the Ctrl key, hit Z) to undo the noise removal, go back to Effect-->Noise Removal, move the slider further left, hit the Remove Noise button again and listen to the entire recording again. Keep doing this until you're satisfied with the recording.
As I said earlier in this post, if you are unable to remove the noise completely without distorting the voice, you have a problem with your hardware and need to have it checked by a competent hardware guy. Yes, Audacity is indeed that good. I've delivered studio-quality sound to clients using nothing more than my home computer, a $2 microphone and Audacity.