After installing Windows XP Service Pack 2, you may receive the following error message in the System Tray.
"This connection has limited or no connectivity. You might not be able to access the Internet or some network resources. "
Solutions to the problem are varied, however most of the solutions found on the web just mask the problem by simply guiding the user through turning off this notification. Now this solution may work great for systems that are showing a false positive error, but what if the system genuinely has lost its local area connection or the connection is unstable, what then?
One possible answer involves a bug in Service Pack 2 of Windows XP dealing with a loss of network connectivity for workstations that use Microsoft’s L2TP-based virtual private networking (VPN) client to connect to servers that are connected to NAT-based networks. However, this bug seems to appear in situations that are not associated with VPNs either.
If patching Windows XP for this bug does not fix the problem, read through the list below of other causes and fixes. You may have to reinstall your firewall, rebuild the configuration in your router, drop your connection speed from 100Mbps to 10Mbps, or assign static IP addresses to your computers in the network to resolve this issue.
How do I know if my system is affected by this bug?
If you have installed Windows XP Service Pack 2 and are experiencing any of the following symptoms, this bug is affecting your system.
After installing Windows XP SP2, your network connection reports a problem with "Limited or No Connectivity"
You have trouble connecting to the Internet or your local area network after installing Windows XP Service Pack 2.
Your network connection gets stuck "Acquiring IP Address"
What Steps Can I Take to Fix This Problem?
If you are receiving this error, you should run the Microsoft patch (KB884020) for it. Follow the instructions below to do this.
1) Download the patch
2) Run the update to install it
3) Run this short Registry fix to complete the update. Type the following lines in Notepad and save the file as FixReg.reg on your desktop, then double click on it to install into your registry.
Windows Registry Editor Version 5.00
4) Reboot your computer
If you experience the error message again, reboot your computer first. In most cases this will solve many connectivity issues that are not associated with this SP2 bug.