Symptom

While using the Parallels Client on Windows XP Machine you will the following error:

    [2825] Network Level Authentication Error 

Cause

Windows XP does not support Network Level Authentication.

Resolution

The issue may be workaround by performing the steps below:

1. Install WindowsXP-KB969084-x86-enu update

2. Open Registry Editor (regedit).

3. Navigate to:

   HKEY_LOCAL_MACHINE\SYSTEM\CurrentControlSet\Control\Lsa
   

4. Modify the key named Security Packages

5. Add tspkg to the listing of security packages.
   
   Note: Do not remove any packages.
   
   
   

6. Modify the key named SecurityProviders

   HKEY_LOCAL_MACHINE\SYSTEM\CurrentControlSet\Control\SecurityProviders
   

7. Add credssp.dll to the listing of Security Providers.