Windows 2008 server hangs at “Applying user settings”, services not working

This is a repost of a post from an old blog, made on July 17, 2012, that used to be on:

http://wp.me/p25nt4-7f

http://adminramble.com/windows-2008-server-hangs-applying-user-settings-services-working/

Original post:

Today I had a problem with one of my test servers that was running Windows 2008, I was doing some work with IIS and certificates and after rebooting I wasn’t able to connect to it with Remote Desktop, also I wasn’t able to connect to the web sites that were on it, but it responded to ping requests.

When I tried to connect to it locally, after entering username and password it would just stay on the “Applying user settings” screen.

The solution to this is very simple:

1. Either wait for you server to eventually finish the logon process or reboot it in the safe mode with F8
2. Open registry editor with regedit
3. Go to HKEY_LOCAL_MACHINE\SYSTEM\CurrentControlSet\Services\HTTP and create the following Multi-string value: DependOnService
4. Double click the entry, enter CRYPTSVC in the Value Data field and click OK
5. Reboot your server to Normal mode

You can also solve the problem with the Hotfix available from Microsoft.

NOTE: the KB article states that this happens on Windows Vista and Server 2008 with Service Pack 2, but in my case I had Windows Server 2008 Service Pack 1.