Technical Anshu
Tutorials Blog
NTLM Blocked Fix

NTLM Authentication Blocked Fix Without Reinstalling Windows

The login worked yesterday. Today Remote Desktop stops with an NTLM authentication error, or the cousin message about CredSSP encryption oracle remediation. Nothing is broken in your Windows installation - Microsoft is deliberately retiring NTLM, and the fix is a settings order, not a reinstall.

By Technical AnshuWindows 10 / 11 / Server8 minute read
Watch the full video - the complete NTLM blocked fix, step by step

NTLM is the old Windows authentication protocol from the Windows NT era. It is weak against relay and pass-the-hash attacks, so Microsoft has deprecated NTLM and is switching it off in stages. NTLMv1 is already removed from Windows 11 version 24H2 and Windows Server 2025, and in January 2026 Microsoft published a three-phase plan that ends with network NTLM disabled by default in a future Windows Server release. When your PC or server still tries to use NTLM and the other side no longer accepts it, you get exactly this family of errors. In the video above, Anshu fixes the Remote Desktop version of this error in about a minute - here is the complete fix order behind it, from the safest check to the setting he changes on screen.

Remote Desktop Connection - authentication error
An authentication error has occurred.
The function requested is not supported.
Remote computer: SERVER01
This could be due to CredSSP encryption oracle remediation.
For more information, see the Microsoft CredSSP troubleshooting guidance.

The error exactly as users see it in Remote Desktop Connection. The wording is an example of the real Windows dialog.

1

Understand What Actually Broke

Nothing in your installation is corrupt. One side of the connection is still offering NTLM - or an old CredSSP version - and the other side has been updated or hardened to refuse it. Three triggers cause almost every case:

Because the cause is a policy or protocol mismatch, reinstalling Windows changes nothing except wasting your day - the same policies and the same updated defaults come straight back.

2

Fix 1 - Connect by Computer Name, Not by IP Address

This is the fastest genuine fix and it needs no settings at all. Kerberos, the modern replacement for NTLM, only works when you address a machine by its name, because the ticket is issued for that name.

If the name connects where the IP address failed, your problem was the NTLM fallback all along - and it is already solved the secure way.

  1. Open Remote Desktop Connection with mstsc
  2. In the Computer field, type the machine name, for example SERVER01 or SERVER01.office.local - not 192.168.1.50
  3. Connect and sign in with the same user name and password
3

Fix 2 - Update Both Ends Before Touching Any Policy

The CredSSP half of this error family is purely a patch-level mismatch: the patched side refuses to talk to the unpatched side to protect your credentials (this behaviour exists because of the CredSSP vulnerability CVE-2018-0886). Microsoft's own recommended fix is simple and often skipped:

A surprising number of these errors disappear here. Only continue if both sides are fully updated and the error remains.

  1. Run Windows Update on your PC (the client) and install everything pending, then restart
  2. Run Windows Update on the server or target PC as well, then restart
  3. Try the connection again before changing a single setting
4

Fix 3 - The Video Fix - Remote Tab and Allowed Users on the Host

This is the method Anshu demonstrates on screen. On the machine you are trying to reach, the Remote settings get re-selected so the host accepts the connection cleanly:

Why it works: Network Level Authentication (NLA) does the sign-in before the session opens, using CredSSP - which is exactly where the NTLM block strikes. Turning NLA off moves the sign-in to the normal Windows logon screen, so the connection gets through.

  1. On the target PC or server, right-click This PC and open Properties
  2. Open Remote settings (Change settings, then the Remote tab)
  3. Click Select Users and make sure the account you sign in with is listed - add it if it is missing
  4. Untick Allow connections only from computers running Remote Desktop with Network Level Authentication, click Apply and OK
  5. Connect again with mstsc using the correct user name and password
5

Fix 4 - If Policy Blocks You, Set CredSSP Policy Consciously

In offices, the block usually comes from Group Policy rather than the Remote tab. The CredSSP policy lives at Computer Configuration - Administrative Templates - System - Credentials Delegation - Encryption Oracle Remediation. Its three levels are also stored as the registry value AllowEncryptionOracle under HKLM\Software\Microsoft\Windows\CurrentVersion\Policies\System\CredSSP\Parameters:

Apply the change with gpupdate /force and restart. The correct long-term answer is always: patch the unpatched machine, then go back to level 0 or 1.

6

Fix 5 - Check the Policies That Refuse NTLM Directly

If the target machine itself rejects NTLM logons, look at two more settings under Computer Configuration - Windows Settings - Security Settings - Local Policies - Security Options:

Change one setting at a time and test after each change. Shotgun changes make the next problem impossible to trace.

🔴 The honesty line: unticking NLA and setting CredSSP to Vulnerable both lower security. They are bridges to get you back in - not permanent settings. Fix the root cause (name instead of IP, updates on both ends, a Kerberos path), then turn NLA back on and restore the policy. And never reinstall Windows for an authentication error: the error lives in policies and defaults, and a reinstall brings them all back.

Watch the Complete Fix in the Video

The full process with live demonstration - every setting shown on screen, step by step.

Watch Full Video
Common Questions

Why does Remote Desktop say NTLM authentication is blocked?

Because one side of the connection tried to authenticate with NTLM and the other side no longer accepts it. The usual triggers are connecting by IP address instead of computer name, a target machine hardened by policy or a recent update, or the removal of NTLMv1 from Windows 11 24H2 and Windows Server 2025.

Is reinstalling Windows ever the fix for this error?

No. The block comes from protocol defaults and policies, not from damaged system files. A reinstall restores the same updated defaults, so the error returns. Work through the fix order instead: computer name, updates on both ends, Remote tab users and NLA, then CredSSP and NTLM policies.

Is it safe to untick Network Level Authentication like in the video?

It is a legitimate temporary workaround and it is exactly what gets many people back in, because the blocked NTLM exchange happens during the NLA stage. But NLA exists to authenticate before a session opens, so leaving it off permanently exposes the logon screen to the network. Re-enable it once the real cause is fixed.

This guide is based on the Technical Anshu video on the NTLM authentication blocked error - if a step gets stuck, ask in the video comments and you will get help there.