IIS has been configured to automatically authenticate users based on Windows authentication, users are authenticated via the Windows domain to log into Service Desk Manager (SDM), and Access Types in SDM are configured to use External OS authentication. In this scenario:
The problem could be due to what is documented in the following article:
Below is an extract of the Symptoms section from the above link. For Cause, Work Around, and additional information, please see the full article.
Article ID: 896861 - Last Review: April 26, 2010 - Revision: 12.0
You receive error 401.1 when you browse a Web site that uses Integrated Authentication and is hosted on IIS 5.1 or a later version
When you use the fully qualified domain name (FQDN) or a custom host header to browse a local Web site that is hosted on a computer that is running Microsoft Internet Information Services (IIS) 5.1 or a later version, you may receive an error message that resembles the following:
HTTP 401.1 - Unauthorized: Logon Failed
This issue occurs when the Web site uses Integrated Authentication and has a name that is mapped to the local loopback address.
Note: You only receive this error message if you try to browse the Web site directly on the server. If you browse the Web site from a client computer, the Web site works as expected.