This are the simple steps to enable it.

1) Run SQL Server Surface Area Configuration - > Surface Area Configuration for features ->

    Select Database Mail - > Check Enable Database mail stored procedures.

2) Open SQL Management Studio - > Management - > Database mail - > Configure SMTP Settings.

3) Go to SQL Server Agent - > Operators - > Create New Operator

4) Go to SQL Job - > In the Notifications, Check email and select the Operator. You can either

select  the option to send notification if job fails / succeeds/ completed.

Lastly, don't forget to restart the SQL Agent.

Legacy Comments

Freelance DBA 2009-03-05	re: SQL 2005 Configuring SQL Job to send email notification if it failed. BTW for sql server 2008 only first step is different (since sql server surface area configuration is goen in last version) exec sp_configure 'show advanced options', 1 reconfigure exec sp_configure 'Database Mail XPs', 1 reconfigure
Freelance DBA 2009-03-05	re: SQL 2005 Configuring SQL Job to send email notification if it failed. BTW, does anybody know if it is possible to use exchange accounts for database mail?
RPaulo 2009-03-05	re: SQL 2005 Configuring SQL Job to send email notification if it failed. Yes you could .. for my SMTP server settings I'm using domain account. domain\login