Spell Check Causing Alert Sound

Ok. I have an Imac. When I am in mail and type a word incorrect I get an alert sound. I do not get the red dashed line. I have looked all over Preferences. What am I missing? This is annoying. If I do a manual spell check of a document then it still does not underline misspelled words. I tested it in Textedit as well. No red line under the words. Please help!!!

Thanks

Thom