Comment 8 for bug 563265

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Ajay Roopakalu (ajay-roopakalu) wrote : Re: package nvidia-current 195.36.15-0ubuntu2 failed to install/upgrade: nvidia-current kernel module failed to build / make[2]: *** No rule to make target `modules'. Stop.

Had the same issue! For me, it was because I upgraded 9.10 -> 10.04 and kept my modified menu.lst file. Running uname -r returned 2.6.31-14 even though I was running Lucid. The latest updates messed up my nvidia drivers. I ended up manually editing the kernels that were being booted in my menu.lst file, updated grub, and uninstalled, reinstalled the nvidia drivers and it worked.