Have Firewall turned on with no exceptions allowed. When I use remote desktop (using an IP address)then connection still gets established. How is this possible,or what am I doing wrong? Tanks for the help

Firewalls are intelligent when it comes to Remote Desktop (RD). If you're running XP SP2 and you enable RD, Windows Firewall will be automatically configured to allow RD connections to ... Read the rest HERE in this FAQ about RD. i_Xp/VistaUser

Thanks XpUser. Now I have one more question. What if the client computer (XP SP2) is hooked up to a router. Is there still need for me to open the port(3389) in the router to its internal IP address.?

Yes, absolutely. Otehrwise if there is an incomming RD request to the router, the router will have no way of knowing what machine it was intended for. Michael J

I have not set up any port forwarding for the remote desktop yet the connection gets established and I can access the HOST computer, can you please tell me how this is possible and what I might have done wrong ? I am using a Netgear FVS318v3 router. Thanks

Are you accessing the remote computer from inside your internal network? If so, then there is no routing taking place. If you are accessing from outside the network, is the PC set up as being in the DMZ? In that case all requests not included in port forwarding settings are sent to the DMZ machine. Also, with Remote Assistance I "believe" you can request assistance from another user and that does not require port forwarding because the initial request includes the required informatin to route the connection. But, I don't know of similar functionality with RD. Aside from that, I don't have an explanation. I would need to see your setup to understand waht is happening. But my past experience and common sense tell me that RD will not work through a router unless there is some type of port forward occuring either explicitly or implied (such as DMZ). Michael J