Terminal Service does not permit logon.

Perhaps you need to check the permissions for the user account you are using. Open the user's properties from Active Directory Users and Groups and check the Remote Control and Terminal Services Profile tabs.

Correct me if I'm wrong but if the user account's permissions were incorrect, I would not be able to logon locally to the TS server and locally to the app server.  What I need is to login to the domain on the TS server.

Thanks,

Are there any group policies in force? Because what it sounds like to me is that there is something in effect as part of the user account on the domain that prevents the login. If you can login to the terminal server locally, but not the domain, that tells me that something somewhere in the domain is the cause. Are you sure you checked the permissions for the user account on the domain, and not just that system's Local Users and Groups? Also check the settings on your Active Directory site, and make sure there are no GPOs (Group Policy Objects) that apply to the user in question that would prevent a login. You can also try logging in as the Administrator to see if it is a global setting or particular to a user.

What permiision would restrict TS access logging into the domain from the TS server, but allow TS access when logging into the app server (the Active Directory controller)?  Administrator has no problem logging in.

The user MAIN:
-  has TS access on the TS server, when the "Log on to:" is set to the local computer.
-  has TS access on the app server.
-  does not have access on the TS server, when the "Log on to:" is set to the domain.

Thanks,