I am afraid to download the new version of itunes on my pc. I am afraid I will lose all of my library. Am I correct?

Updating iTunes won't erase the library, but you should back it up first.

(77404)

I updated to 11.0.2.25 without losing a thing.

That being said, it's still a good idea to always maintain a current backup in case of disasters of any sort.

I think you better wait for a while because the new version I loaded yesterday is still having a ploblem with printing the playlist which print on top of the other. The same problem took place last December and I wonder why Apple didn't test before releasing the new version.

The following document might be of some help:

iTunes: Back up your iTunes library by copying to an external hard drive.

(If your content and library files are in the default locations, you can skip the consolidation step.)