About Windows Update
Windows Update is the online extension of Windows that helps you to keep your computer up-to-date. Use Windows Update to choose updates for your computer’s operating system, software, and hardware. New content is added to the site regularly, so you can always get the most recent updates and fixes to protect your computer and keep it running smoothly.
Definitions:
How do I know if I need an update?
Windows Update scans your computer and provides you with a tailored selection of updates that apply only to the items on your computer. During the scan, a list of categories appears under Welcome to Windows Update and the number of updates that are available in each category is noted in parentheses.
Critical Updates are important!
Any update that is critical to the operation of your computer is considered a "Critical Update," and is automatically selected for installation during the scan for available updates. These updates are provided to help resolve known issues, and to protect your computer from known security vulnerabilities. Whether a critical update applies to your operating system, software programs, or hardware, it is listed in the "Critical Updates" category.
Step 1:
Step 2: Click on the "Automatic Updates" tab.
Check the box that says "Keep my computer up to date..."
Select "Automatically download the updates and install them on the schedule that I specify" radio button.
Set Schedule to "Every Day" at "3:00am" (Default) or another time of your choice. (Remember that your computer must be on to receive Automatic Updates)

Click "OK" to save your settings. (Your settings should look similar to the above picture)
Your computer has now been configured for Automatic Updates.
Step 1: Open a browser window and go to "Tools" and select "Windows Update" or go to http://windowsupdate.microsoft.com
Step 2: Click on the "Scan for Updates" link.
Windows Update will now scan your computer for required updates.
If critical updates are found, they will automatically be added to the installation list. Add any other non critical updates that you wish to install. (Not required)
Step 3: Click on the "Review and install updates" link.
Step 4: Click on the "Install Now" button.
Windows Update will download and install the selected updates.
Step 5:
After the download and installation process has completed you may be prompted to restart your computer. If so, click on "OK" to restart your computer.
You are done. Your computer has been successfully updated!