Kerberos authentication is not negotiated with Internet Explorer 5.5 or 5.5 Service Pack 1 (SP1) if a fully qualified domain name (FQDN) is used to connect to the Web server. This issue does not occur with Internet Explorer 5.01 or if the short (RDN) server name is used.
This issue occurs because the Internet Explorer 5.5 code does not pass the right SPN when it calls the InitializeSecurityContext
To resolve this problem, obtain the latest service pack for Internet Explorer 5.5. For additional information, click the following article number to view the article in the
Microsoft Knowledge Base:
How to Obtain the Latest Service Pack for Internet Explorer 5.5
To work around this issue, do not connect using the FQDN with Internet Explorer 5.5 or 5.5 SP1 if you need Kerberos to be negotiated.
Microsoft has confirmed that this is a problem in the Microsoft products that are listed at the beginning of this article. This problem was first corrected in Internet Explorer 5.5 Service Pack 2.