You may receive the error "The request failed with HTTP status 401: Access Denied." when trying to access a Webservice from your ASP.NET Application.

This normally indicates that Anonymous access has been disabled for the Webservice.

Also, when you try to step into the webservice using the Visual Studio debugger, "Unable to automatically step into the server. The remote procedure could not be debugged. This usually indicates that debugging has not been enabled on the server. See help for more information"
in this scenario.

We can resolve this issue by either of the following ways:

1. Enabling Anonymous Access in the IIS Directory Security

To do this, the following steps will help you.

1. Click "Start" - "Run" - Type "inetmgr" and press "Ok" or "Enter" Key

2. IIS Control panel opens.

3. Expand the appropriate nodes and navigate to the virtual directory of your Web Service Application.

4. Select the Virtual directory, Right Click and select "Properties"

5. Switch to the "Directory Security" Tab and then Click "Edit".

6. Check the "Anonymous Access" CheckBox.

7. Click "Ok" twice to exit.

This should solve the issue.

2. Programattically assigning the Credential Cache

In case you dont have access to change the IIS Settings or you just dont want to allow anonymous because other applications are using it, then you can programatically provide the permissions by specifying the credential cache.

Let us assume we have a Webservice, Service which has the default Web Method HelloWorld. Let us see the steps involved in accessing the service.

Service Service1 = new Service();
Service1.PreAuthenticate = true;
Service1.Credentials = System.Net.CredentialCache.DefaultCredentials;

As you can see, we are passing the CredentialCache object for the Service1.

This would ensure that we preauthenticate the access to the Service. This would be applicable in the case of Integrated Windows Authentication scenarios.

Cheers and Happy Programming !!!