Here’s how to turn it off:

Go to your Control Panel.  Choose “Folder Options.”  Go to the “View” tab, scroll down to the entry that says “Hide extensions for known file types” and un-check it if it is checked.  Hit “Apply” and then if available, “Apply to Folders.”

Here is why I recommend you turn it off:

Ever since Windows 95 was released the default setting was to hide extensions for known file types.  The reasoning behind that being the default was to make Windows look more like a Macintosh where the picture of the icon is what tells you what kind of file it is, instead of the usual 3 characters after the dot.

Sure it’s nice having the icon so you cant tell at a glance what is an Excel spreadsheet and what is an MP3 song, but by seeing the 3 character extension, you can tell for sure before you try to open something you didn’t intend.

People who have written trojans (viruses) take advantage of this.  A file name can have only one extension but they can have more than one dot in the name, so the real extension is whatever is after the last dot.  Some trojans are named something innocent looking, which appears to not be executable, such as “hello.txt.exe” The real extension being .exe makes it executable.  If the setting to hide extensions is turned on like the default, then all you see is “hello.txt” making you think it is safe to open it because you would expect it to simply open in notepad, but instead it executes the .exe file.

If this setting was what I recommend, then you will immediately see that it is really an .exe file and should know to exercise caution handling this file.  (Such as running a virus scan on it before doing anything besides deleting it).