Windows XP Service Pack 2 Bug
1. Review the following symptoms and determine if you experience any of them after you install the Windows XP Service Pack 2:
You get the error message 'Limited or No Connectivity' when you attempt to connect to your network.
You have a problem connecting to your local area network or to the Internet.
You keep on receiving an error message: 'Acquiring IP Address' message.If you experience these symptoms after installing Windows XP Service Pack 2, then this bug is causing the problem. In this case, go to Step 2; otherwise, skip to Section 3.
2. Download the Microsoft patch (KB884020) from the Microsoft website. Run this update to install it.

3. Create a registry fix by launching Notepad and typing: [HKEY_LOCAL_MACHINE\\SYSTEM\\CurrentControlSet\\Services\\IPSec] 'AssumeUDPEncapsulationContextOnSendRule\'=dword:00000002Save the file as FixReg.reg to your desktop. Double-click the saved file to install it into your registry. Restart your computer and the error message will likely be gone. If you still see the error message, follow the steps in Section 2.
If Your Connection Works But You Still Get the Error Message
4. Navigate to the 'Start' button and select the 'Control Panel.'
5. Double-click on the 'Network Connections' icon. Right-click the 'Local Area Connection' icon and select 'Properties' from the popup menu.
6. Click on the 'General' tab. Uncheck the option that is labeled 'Notify me when this connection has limited or no connectivity.' Click 'OK.'
If the Patch Doesn't Fix the ' Limited or No Connectivity' Problem
7. Check your DSL router for any malfunctions. Re-configure or power cycle your router.
8. Check your computer's network card configurations and network cabling to ensure that the problem does not lie here.
9. Check your firewall to determine whether it is blocking you from connecting to the network or to the Internet. Disable the firewall and attempt connecting to the network or Internet while with the firewall is disabled. If the firewall is causing connection problems, then reset or uninstall and re-install the firewall.
10. Reduce your connection speed to 10 Mbps and test this to determine if it fixes the problem. To do so, navigate to the 'Start' menu and select the 'Control Panel,' 'System' and 'Device Manager.' Review the properties of your network card. Click the 'Advanced tab.' Locate the 'Link Speed and Duplex' section. Change the settings from 'Auto Detect' to '10Mbps/Full Duplex.'