Get SharePoint host headers working locally in Windows 2008 R2

So as we all know by now I recently rebuilt my machine with Windows 2008 R2. My main reason for doing this is so I could have a fully functional SharePoint development environment that runs locally without the need for virtual machines. Plus I now have the option of using Hyper-V when I do have the need for a virtual environment.

I did however run into an issue when I attempted to setup my local development SharePoint site. Personally I prefer to have my local dev site under a host header, this time I decided to use spdev.local as my site host header. As per usual I also updated my hosts file under c:\windows\system32\drivers\etc to point to the local IP (127.0.0.1) for that host header.

However when I attempted to access my shiny new dev environment IE would prompt me for my credentials a number of times then simply display a blank page.

After doing some  “Binging” I tracked down the following TechNet article that informed me of a security feature related all the way back to IE 5.1. The long and short of it is that the security update in question prevents IE from navigating to a host header site on a loopback adapter.

This setting is configured in the registry on windows, and there are actually 2 registry settings that can be used to resolve this issue.

The first disables windows making the loopback check all together, the second allows you create a list of “trusted” host headers

Now while I could duplicate the instructions to this workaround best to checkout the TechNet article directly

http://support.microsoft.com/kb/896861

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