Is the problem that the History menu no longer displays the Recently Closed Tabs list (the list is empty), or that choosing a Recently Closed tab doesn't actually open it?

To quickly check whether an add-on might be at fault, could you try Firefox's Safe Mode? That's a standard diagnostic tool to bypass interference by extensions (and some custom settings). More info: Diagnose Firefox issues using Troubleshoot Mode.

You can restart Firefox in Safe Mode using

Help > Restart with Add-ons Disabled

In the dialog, click "Start in Safe Mode" (not Reset)

Any difference?

Instead of resetting your whole browser, try opening a new tab, type "about:config" w/o the quotes and hit enter. Then under search near the top, type: sessionstore and right click->reset anything that is bolded, particularly browser.sessionstore.max_tabs_undo and browser.sessionstore.max_windows_undo. It did the trick for me.

My "Recently Closed Tabs" was grayed out and inoperative. As of Dec 2nd this "fix" still works. Thanks for posting it.

Why doesn't the fix stick? What's going on to change it ?

Odds are there is some form of malware running in firefox. Go to Firefox->Add Ons, then select Extensions. I would disable anything that looks suspicious (or one by one), restart, then do my fix, and restart again and see if the changes stuck.

Usually things that cause this are unwanted virus scanners and other search toolbar helpers (that you probably didn't install). I don't remember what caused my issue as it was so long ago.

I'll keep an eye on it then. Right now, all Extensions, toolbars, etc. are disabled, but I've recently run malware protections that (I think) included a Firefox reset. Thanks for your feedback.

I also had the problem reoccur after the first fix. Following munky's suggestion, I deleted the only recent extension (Ads Removal 1.0.0) restarted, reapplied the fix and restarted again. Everything worked. I then ran a rootkit scan with PC Tools ThreatFire since this is the only antivirus tool that I've recently run. I then did a "cold" reboot, started Firefox, opened and closed some tabs and everything seems to be working properly. Evidently my case involved the Ads Removal 1.0.0 extension. Thanks for your help, I'll continue to monitor and and advise of any further changes.

It appears that Ad Removal 1.0.0 was not the problem after all. I just ran Glary Utilities and if the "Temporary Files Cleaner" box is checked then the cleanup interfers with the Firefox "Recently Closed Tabs" function. As long as the Glary Utilities "Temporary Files Cleaner" box is left unchecked, then everything works as it should.

After experiencing the problem with Glary Utilites Temp file cleaner mentioned above - I also ran Wise Disk Cleaner (Common Cleaner and Advanced Cleaner) and Advanced System Care as well as Microsoft Disk Cleaner on both the Operating Drive and the Data Drive. I also manually deleted Temp files via "run %temp%" and also navigating to: "C:\users\<name>\appdata\local\microsoft\windows\temporary files" and manually delteting the entries. I did a "hot boot" after each routine and Firefox "Recently Closed Tabs" remained intact in each instance. It seems that "Glary Utilities 4 Temporary Files Cleaner option" is the culprit in my situation. Deep apologies to "Ads Removal 1.0.0" castigated unfairly in my previous post and Thanks again to "munky" for the very helpful post.