After we enable FIPS encryption in system security settings the asp.net 3.5 based applications which uses the script manager control stopped working. SharePoint application also falls under this category and there is a Hotfix from Microsoft for this (KB981119). Unfortunately this hotfix applies to W2008R2 which came before the SP1.
If you are using the OS which comes with SP1 you will not be able install this hotfix (since it’s older than SP1). At least as of now there is no newer version of this fix for the system which comes with SP1.
To fix this issue, update the <machineKey> section in your config file with the below mentioned value. I assume that’s what the hotfix does. Since we are not able to install the hotfix we have to manually update the config files. For SharePoint applications make sure you update the machinekey values in all config files including central admin.
<machineKey validationKey="AutoGenerate,IsolateApps" decryptionKey="AutoGenerate,IsolateApps" validation="3DES" decryption="3DES"/>
Hope this helps someone!
