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Repeated prompt for user name and password while opening Office document in SharePoint Server 2010 or SharePoint Foundation

When you click a Microsoft Office 2003 document or a Microsoft Office XP document, a Connect to ServerName dialog box appears. This issue occurs if the following conditions are true:

• The Office 2003 document or the Office XP document is stored in a document library.
• The document library is stored in a Microsoft Office SharePoint Server 2007 site, in a Microsoft Office SharePoint Portal Server 2003 portal site, in a Microsoft Windows SharePoint Services 3.0 site, or in a Microsoft Windows SharePoint Services 2.0 site.
• The Web servers are part of an intranet or an extranet.
 Additionally, you are prompted to enter your user name and your password even though you already entered your user name and your password to access the site.

Cause: This issue occurs if the virtual server in Microsoft Internet Information Services (IIS) 6.0 is configured to use Basic authentication. Your user name and your password do not pass seamlessly from Microsoft Internet Explorer to the Office program.

Workaround:

1. Start SharePoint Central Administration.
2. Click the Application Management tab, and then click Manage Web Applications.
3. Select the affected Web application, and then click Authentication Providers in the top Ribbon.
4. In the dialog box, click the zone that is set to basic authentication.
5. In the Authentication Provider dialog box, under the IIS Authentication Settings section, choose Windows Integrated instead of (or in addition to) basic authentication. Choose NTLM or Negotiate(Kerberos), and then click Save.
6. Click the X to close the authentication providers dialog box.

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