Why does Windows 7 ask me to install updates when I have automatic updating turned on?

For Windows, the easiest way to install updates is to turn on automatic updating. Windows will install new updates as they become available. – microsoft.com

I have automatic updating turned on. However, few days ago Windows started to ask me to install updates.
Why? And how can I make the updating really automatic?

Answer

What you're observing is the expected behavior.
Even with Windows Update configured to install updates automatically you will continue to be prompted to install them until the offered updates get installed.

Common scenarios where this occurs:

1. Windows Update is configured to install updates automatically every day at 3AM. WU detects available updates at 9AM. These will be offered until 3AM comes. If the computer is off at the scheduled install time, they'll continue to be offered until they finally get installed.


2. Some updates require acceptance of an EULA. These never install automatically (unless you're in a WSUS managed environment where your administrator has accepted the agreement for you).


3. An update is failing to install correctly. In this case, even though WU is attempting to install the update automatically, the fact it fails results in its being offered repeatedly.

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Use Group Policy to Reduce Windows Update Notifications. If you have a Pro version of Windows you can use Group Policy editor to minimize the number of notifications you receive from Windows Update:

1. Configure Windows Update (via Control Panel) to install updates during overnight hours. This gets most updates installed without users seeing any prompts. Remember to leave the computer ON!



2. Run gpedit.msc to open the local Group Policy Editor



3. Navigate to:

   
   
   

   Computer Configuration/Administrative Templates/Windows Components/Windows Update




4. Modify the following settings:

   
   
   
   
   
   • Allow non-administrators to receive update notifications: Disabled
   
   
   • Reschedule Automatic Updates scheduled installations: Disabled
   
   
   • Do not adjust default option to 'Install Updates and Shut Down' option in Shut Down Windows dialog box: Enabled
   
   
   



5. Close Group Policy editor
   

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   The effect of these three settings are (in order shown above):
   
   
   
   
   • Entirely prevent non-Administrative users from receiving notifications from Windows Update (there's no way to completely hide notifications from Admins)
   
   
   • Force WU to only install updates at the time configured in the WU applet in the Control Panel. This eliminates annoying reboot prompts to the user caused by a daytime WU installation, which by default, would occur if an overnight scheduled installation were missed.
   
   
   • Don't prompt users during computer shut down to install updates; however the option will remain available should the user want to install updates during shutdown.