If you have a computer on which Windows Vista or Windows 7 is running and there is no proxy configured in the Internet Explorer of Windows and you are using the WebDav for accessing such sites that have fully qualified domain names. In this kind of situation you would be asked to enter your credentials even if you have the user account which you are using has the sufficient permission for accessing this kind of website. For instance if you open a file of Microsoft office from the website of the Microsoft Office sharepoint with the help of the Microsoft office 2007 on a client computer which has the Windows Vista operating system that does not have a proxy configured and you are prompted for the authentication. This is not the case with the Windows XP operating system.
In the Windows Vista operating system, the Internet explorer makes use of the service of the web client when you are using the internet explorer for accessing the resource of the WebDav. The HTTP services are used by the web client service for performing the network I/O to the host which is located remotely. WinHTTP would send the credentials of the user only in a response to the requests sent to it which occurs on a local intranet site. But the WinHTTP does not check the settings of the security zone that are present in the internet explorer for finding out that whether any web site is present in that particular zone or not and allows the credentials to be sent in an automatic manner. If there is no proxy configured then the WinHTTP would send the credentials only to those sites that are local to the intranet.
Solution to this problem
When you are experiencing this kind of situation and need to resolve it then there is a hotfix available for this. The hotfix can be downloaded and you can easily get rid of the problem that are facing. There are no pre-requisites of the hotfix and can be done easily. You should restart the computer for installing the hotfix.
In order to use this hotfix you would need to modify the registry. You should be very careful when modifying the registry as any change made to it. Before making the changes you should keep a back up of the registry so that you should have increased protection for your system. After you have applied the hotfix then you would have to enter this to the registry by following certain steps. First click on the start button then in the start search box type regedit and press enter. Look for the registry and click on the subkey of HKEY_LOCAL_MACHINE\SYSTEM\CurrentControlSet\Services\WebClient\Parameters. On the edit menu point to the new and then click on the multi string value. Then type AuthForwardServerList and press enter. Click modify on the edit menu. In the value data box write the url of the server which is hosting the web share and then press enter. After doing all of this you should exit from the registry editor.