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I recently moved a long-functioning web app from a Windows 2003 server to a windows 2008 server. Everything works fine, save for the email service (send password and the like). The code works on my local machine and the original web server. The system throws no errors, but the message stays endlessly in the Queue. I have granted full access to all relevant users (Network Service, IISUsers, etc). Is there something I'm missing, or does IIS7 just not send email via web applications?

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Can you send email from that server at all? Have you tried using a mail client or telnet? –  Sam Feb 5 '11 at 21:14

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you need to setup the smtp server on your server, please refer http://www.itsolutionskb.com/2008/11/installing-and-configuring-windows-server-2008-smtp-server/

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