looking for a free audio recorder so user will be able to record him self and the record will be uploaded to the server (by Rails).
Is there something I can use to achieve this?
It is not so easy. There is no ready solution. You should setup your own media server, then pass to it sound (via Flash, I believe), record this sound on server and then store somewhere on server.
UPD
Similar question: How to record voice files using PHP, FLASH