This procedure appears to have been changed in PayPal.

  1. Log into Paypal. 
  2. Click Profile.
  3. In the Selling Preferences section, click Instant Payment Notification Preferences. 
  4. Click Turn On IPN. 

Former Procedure

  1. Log into Paypal. 
  2. Click Profile.
  3. Click My Selling Tools. 
  4. In the "Getting paid and managing my risk" section, find Instant Payment notification and click Update. 
  5. Click Edit Settings. 
  6. Enable Receive IPN messages (Enabled).
  7. Click Save.