This Computer Can’t Connect to the Remote Computer Issue on Windows 2008 R2

My IT manager wanted me to to configure a new server with Windows Server 2008 R2 to create an IIS server to get a website up and running for this weekend.  The machine was done and it was pushing out Windows updates. The last thing he requested was to turn on Remote Desktop on the server, so he can log into it and continue configuring it from home. I enabled it and I checked it because I was already RDP into the machine when I started the last batch of updates before I left for the day. When I arrived at the office, my IT manager stated that he couldn't RDP into the server. I checked it out for myself and it worked. It worked for me because I wasn't using the Remote Desktop Connection application within the Windows OS. I normally use a third party application. He was getting the following error:

Apparently, this is a common issue with RDP and dealing with Windows Server 2008 R2. What I did to fix the issue was the following:

Go to Start > Administrative Tools > Remote Desktop Services > Remote Desktop Session Host Configuration

Once the Remote Desktop Session Host Configuration window loads – right click on the RDP-Tcp under connection and click on Properties:

You will get the RDP-Tcp Properties dialog box:

Under the Security section of the dialog box I changed the Security layer to “RDP Security Layer”. By default it’s configured to be “Negotiate”:

When you make the change hit Apply and Ok. You will then get this dialog box:

Now, go back to your client machine and start your RDP session again. You will noticed that it remote into the server. By the way, one more then I forgot to mention. We disable the TLS and SSL on the server, so I don’t know if that plays a part with this issue.