`Error! Could not locate dkms.conf file`

This is usually caused by modules in /var/lib/dkms that don't have a dkms.conf file within their source subdirectories - dkms expects this file, so will report an error if it's missing, and then may miss out on compiling some valid modules.

To find the offending module, run this short script (thanks to Lekensteyn):

for i in /var/lib/dkms/*/[^k]*/source; do [ -e "$i" ] || echo "$i";done

That will output any dkms module directories; you can then decide whether to uninstall the package that created them, or if they've been manually installed or renamed, to move them somewhere else or remove them.

I've been getting that on kernel upgrades for a while, with the result that not all of my dkms drivers get updated on kernel-upgrades.

Firstly I was able to workaround the problem by reconfiguring any packages that used dkms to force them to be recompiled for the current kernel - eg it was my AMD video drivers that failed (package == fglrx):

sudo dpkg-reconfigure fglrx

That would at least get the drivers configured for the current version.

Finally I found this bug, which includes some steps you can use to diagnose: https://bugs.launchpad.net/ubuntu/+source/dkms/+bug/830915

dkms status
ls -R /var/lib/dkms

Basically what they're doing is looking around for anything that is surprising, or unexpected - eg packages you have uninstalled - or software you have manually installed on an earlier ubuntu version and may not work with the newer version. Particularly check the date-stamp on the directories which might show you particularly old packages could be from manually installed packages.

ls -l /var/lib/dkms

In my case I had an old version of the fglrx install I had used to diagnose some problems a year ago and had simply re-named it. Deleting this old cruft made the problem go away.

If there's junk delete it (or move it out of that directory) - if there's a manually installed package there, consider updating it, or uninstalling it and using the maintained version.

I have had this problem with VirtualBox from Oracle's ppa, rather than the one packaged with 12.04 LTS :

Error! Could not locate dkms.conf file.
File:  does not exist.

I copied the contents of /var/lib/dkms to another directory as a backup, then removed the vboxhost directory in /var/lib/dkms;

mkdir ~/backup_dkms
cp -r /var/lib/dkms/* ~/backup_dkms 
rm -rf /var/lib/dkms/vboxhost

I then reconfigured the virtualbox package like this:

sudo dpkg-reconfigure virtualbox-4.2

and it succeeded in doing this:

   * Trying to register the VirtualBox kernel modules using DKMS