Error message when you try to connect to a computer that is running Windows XP or Windows Server 2003 through a RDP connection from a Windows Vista-based computer: "the remote computer you want to connect to cannot recognize credentials"
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On a Windows Vista-based computer, when you try to connect to a computer that is running Windows XP or Windows Server 2003 through a Remote Desktop Protocol (RDP) connection, the RDP connection fails. Also, you receive the following error message:
The security policy of your computer requires you to type a password on the Windows Security dialog box. However, the remote computer you want to connect to cannot recognize credentials supplied using the Windows Security dialog box. For assistance, contact your system administrator or technical support
This problem occurs when the Require trusted path for credential entry Group Policy setting is enabled on the Windows Vista-based computer.
If the Require trusted path for credential entry Group Policy setting is enabled on a computer that requires the Secure Desktop feature when you enter the credentials, the credentials are encrypted in memory. Only a computer that supports Credential Security Service Provider (CredSSP) can read the credentials. However, CredSSP is only supported in Windows Vista and later operating systems.
To resolve this problem, disable the Require trusted path for credential entry Group Policy setting. To do this, follow these steps:
Click Start, type gpedit.msc in the Start Search box, and then press ENTER.
Note If you are prompted for an administrator password or for confirmation, type the password or provide confirmation.
Expand Computer Configuration, and then expand Administrative Templates.
Expand Windows Components, and then click Credential User Interface.
Double-click Require trusted path for credential entry, click to select Not Configured, click Apply, and then click OK.
Exit Group Policy Object Editor.
Run the gpupdate /force command at a command prompt to apply this policy setting.
Connect to the destination computer through the RDP connection again.