Mind telling us some specs?

I am also facing the same issue. But could not able to find any absolute solution but i have found one thing if i use the vlc media player and windows media player then this problem occurs..

Windows XP, Media Center Edition,SP 2,HP Pavillion, AMD Athlon, dual 64x2, 960 mb Ram, sound blaster audigy in slot 1. When sound functioning the "Sound and Audio Devices Properties" reports the audio device as "Sound Blaster Audigy". Later sound disappears and the panel reports "No Audio Device". If I reboot, the audio system is back to normal for a while.
Tom Dowling

try downloading the latest driver for xp, for your audio device...check if it will help...
http://www.soundblaster.com/downloads/

Definitely update the drivers...

Now, my 2 c:

Sound does not disappear by it self for no reason.

You should check the Event Viewer and look for logs regarding audio hardware. (if the problem is of hardware or driver nature)

Also, if you have several codec packs, you should keep in mind that they are probably in conflict. Try uninstalling them all, and keeping only one.

Nothing indicated on the event logs. I'll try disabling all but one audio codec. I have ruled out hardware, as the sound is restored on reboot.
Thanks for your help.
Tom Dowling