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Every month or so IIS 7 running on Windows Server 2008 drops our Virtual Directory settings. I've checked the applicationHost.config file and it appears to save properly.

In the event viewer I did find this somewhat mysterious log:

The WinHTTP Web Proxy Auto-Discovery Service service entered the stopped state.

That is preceded by hundreds of logs referring to an server update.

What would cause IIS 7 to drop a virtual directory?

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Although I am sure your server is assigned a static IP address, I would check to see if the DHCP service is not disabled.

A simplistic explanation of the WinHTTP Web Proxy Auto-Discovery Service (aka) Web Proxy Autodiscovery (WPAD) is that its a web cache service that stores copies of Web pages. It relies on the DHCP service.

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