What you are describing is called Surreptitious Recording. Here's some info I found on this: The following is from: http://www.rcfp.org/handbook/c03p01.html Of the 50 states, 38, as well as the District of Columbia, allow you to record a conversation to which you are a party without informing the other parties you are doing so. Federal wiretap statutes also permit one-party-consent recording of telephone conversations in most circumstances.1 Twelve states forbid the recording of private conversations without the consent of all parties. Those states are California, Connecticut, Florida, Illinois, Maryland, Massachusetts, Michigan, Montana, Nevada, New Hampshire, Pennsylvania and Washington.2 The federal wiretap law, passed in 1968, permits surreptitious recording of conversations when one party consents, "unless such communication is intercepted for the purpose of committing any criminal or tortious act in violation of the Constitution or laws of the United States or of any State." Amendments signed into law in 1986 and 1994 expand the prohibitions to unauthorized interception of most forms of electronic communications, including satellite transmissions, cellular phone conversations, computer data transmissions and cordless phone conversations. Most states have copied the federal law. Some expand on the federal law's language and prohibit all surreptitious recording or filming without the consent of all parties. Some state statutes go even further, prohibiting unauthorized filming, observing and broadcasting in addition to recording and eavesdropping, and prescribing additional penalties for divulging or using unlawfully acquired information, and for trespassing to acquire it. In most states, the laws allow for civil as well as criminal liability. Many of the state statutes make possession of wiretapping devices a crime even though one-party consent to taping conversations may be allowed. Most of the state statutes permit the recording of speeches and conversations that take place where the parties may reasonably expect to be recorded. Most also exempt from their coverage law enforcement agencies and public utilities that monitor conversations and phone lines in the course of their businesses. In general, state statutes apply to conversations that take place within a single state. When the conversation is between parties in states with conflicting eavesdropping and wiretapping laws, federal law generally applies, although either state also may choose to enforce its laws against a violator.

This is an answer that depends on the state you live in. Some states require both parties agree to being recorded - some states only require one. Which state are you asking this question about?

The other answers pretty much covered it, giving that you did not specify a jurisdiction. The exact law varies widely by state. However, I will add this. The answer also depends on whether or not you are a party to the conversation, if the speakers have an expectation of privacy, and the manner in which you record. For example, even in California (which requires both parties to consent), you can setup a video or audio device and record people in public. Also, knowledge is usually all that is required, even in states that require two party consent. If you enter a building that has posted warnings that you are being recorded, most states will call this consent even though you never affirmatively agreed to be recorded, and sometimes even though you did not notice the warning.

My neighbor has a camera that is pointed to watch me in my garage. this is a my privet home