Is there a way I can get complete log/trace for users being logged in to CME 2011 SP1. For example: Is it possible to retrieve a list of all the users currently logged in to the CMS or users logged/performed some activity across a time period.
Yes and no.
IIS gives you all of this information (and way more) in its logs. You can probably use tools like IIS Log Analyzer to compile this information for you.
An alternative way is to use the Event System to log what happens for you, like we do in the "Tridion 2011 Reporting" project (look at the event system code there, it logs to a MongoDB database).
As Nuno mentions, IIS logs provide this info. Here is a link to a Q&A that is very much in context of what you're asking: https://stackoverflow.com/questions/12503734/retrieving-user-login-time-in-sdl-tridion-2011