Your audio drivers should have allowed you the option to select line in for recording (some (most?) also allow it to happen in real time as it would any other sound source)- make sure the option is selected (if necessary) and not muted. Unlike most other software selected volume controls in my experience having the line in volume all the way up is not necessary or even good (it gets distorted).
Some pictures of what you are likely to see
http://www.dettecelectronics.com/images/volume-control-line-in-mute.gif
http://www.nsftools.com/misc/VolumeControlLineIn.png
On top of this laptops are odd as the port you shoved it in probably does double duty as a microphone port (if it is red then almost certainly)-the only real difference is a mic port will have some voltage on it to power the mic where line in does not. Using a port inappropriately can damage things but that seems mainly to be one of the many safety tips (think "safe eject" of USB drive on windows) rather than a machine killer, most made in the last decade or so will autosense but know you might have to change it.