Let's try a couple of things to try to pinpoint what the problem is.

1) Start a new session of Excel. Add a new workbook. Type a few things into a couple of cells. Is the undo command available? If it is available then it's an issue relating to your other workbook, not Excel in general.

If not:

2) Start Excel in safe mode*, add a new workbook, type into a couple of the cells. Is the undo command available now? If yes, then I suspect an add-in is causing the problem.




* To start Excel in safe mode, open windows explorer and then browse to Excel.exe. It's probably in the folder:
C:\Program Files\Microsoft Office\Office14
Then hold down the CTRL key, right click on Excel.exe and choose Open. You will get a prompt asking you if you want to start Excel in safe mode and you should choose yes.