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Dumb question: Is your second monitor plugged in and recognized?

Opening the Display pane in System Preferences should cause one window to open on each display. The one on your MacBook should have an Arrangement tab in the middle, while the one on your external display should not.
 
Just to confirm - you actually have the second monitor attached, correct? Make sure the cables are connected correctly and the external monitor is turned on.

Do you see anything on the external monitor (mirroring)? I believe even if mirroring is turned on you'll see the Arrangement panel.

Edit: too slow...
 
Other obvious one... you should see an item in the display tab of the Displays pane that is a checkbox, with a description that says something about mirroring mode. I don't have a monitor plugged in right now, so I don't have the box to tell you, but whatever it is set at now, toggle it (if it's checked, uncheck it, or vice versa). This box controls whether the two displays mirror each other (show the same thing) or not. You only see the arrangement tab when they are set to show different content (i.e. not mirror), as arrangement is a moot issue when they are mirroring. EDIT: Well, I'll defer, but it's my impression the tab appears when you go to a non-mirrored config and is otherwise not there).
 
You only see the arrangement tab when they are set to show different content (i.e. not mirror), as arrangement is a moot issue when they are mirroring. EDIT: Well, I'll defer, but it's my impression the tab appears when you go to a non-mirrored config and is otherwise not there).

I see the Arrangement tab in both mirroring and extended desktop modes. The displays are just on top of each other when in mirroring mode.
 
I haven't seen it mentioned yet, but if you have the second monitor plugged in and turned on have you tried hitting the Detect Displays button in the Displays tab? I know sometimes I need to hit that before my PowerBook will recognize there is another display connected.

Do MacBooks support spanning now? I remember iBooks used to only mirror unless a third party hack was installed to enable spanning.
 
Do MacBooks support spanning now? I remember iBooks used to only mirror unless a third party hack was installed to enable spanning.

Yep, all MacBooks support extended desktop mode.
 
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