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When a hard drive is failing, the clicking noise that it makes is what I liked to call the click of death. It indicates mechanical failure inside the drive, and it means that your hard drive is on its way out. The sad thing is that when this happens, there isn’t anything you can do to fix it. Your only option is to attempt to back up as much as you can from the drive before it completely fails, then get a replacement hard drive.
The clicking sound you hear is caused by one of the motors inside the hard drive. It works sort of like a record player in that you have a disc that spins around and an arm that moves back and forth reading data from the disc. If the motor that makes it spin or the motor that moves the arm starts to go out, you will experience all kinds of issues with your computer. The clicking sound comes from the moving parts not moving the way they should.
In some ways, the click of death can be helpful in that it indicates a problem while you still might be able to salvage some data from your hard drive. Depending upon the severity of the hardware malfunction, you might actually be able to backup your entire drive. I’ve seen other hard drives fail without giving any kind of warning whatsoever, so if you can still get the drive to work while it clicks, then you’re having a good day.