Problem connecting to Exchange server 2003

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    I have setup an Exchange server under a domain xxx.local and created the mailboxes for all the users in AD. When trying to connect to to the exchange server from a pc connected and joined in the same domain and after i input the server name in the exchange input box ( i have even tried the ip and netbios name) and part of the username in the mailbox input box (it resovles ok) a screen is poped requiring me to enter a username and password for the domain in the format of netbiosnameusername. After completing the inout for both username/password the box is displayed again not allowing outlook to start. Is this a DNS problem? What can I do to fx this problem?

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