HTTP Error 401.3 - Unauthorized You do not have permission to view this directory or page because of the access control list (ACL) configuration or encryption settings for this resource on the Web server

Recently i encountered this issue while deploying an asp.net solution on Windows Server 2008 R2. 

Looking at the error, i was quite sure it has something to do with website permissions. 

By default IIS treats anonymous authentication credentials to Specific User and if that specific user doesn't have permission on wwwroot folder then IIS will throw HTTP 401.3.

Solution

- Go to IIS Application server manager

- Choose IIS -> Authentication

- Edit Anonymous Authentication

- Change Anonymous User Identitiy to Application Pool Identity

hopefully this will work!