it may not be the permission issue. can you ping each other by ip? if yes, can yu ping by name? this step by step troubleshooting may hekp, http://www.howtonetworking.com/Troubleshooting/notaccessibale0.htm
Don't send e-mail or reply to me except you need consulting services. Posting on MS newsgroup will benefit all readers and you may get more help.

Bob Lin, MS-MVP, MCSE & CNE
How to Setup Windows, Network, Remote Access on http://www.HowToNetworking.com
Networking, Internet, Routing, VPN Troubleshooting on http://www.ChicagoTech.net
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 I have a  laptop running xp pro with NTFS
 and a desktop running xp pro  fat32

 I have tried all sorts of permissions with no success...
 How do I set up so I can share files and folders with desktop
 Someone gave me good websites to review but it did not solve my problem.
 I can't see from the desktop or the laptop any computer but the self.

 can anybody help before I lose my mind ;-)