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  1. I bought an domain name,
  2. I have a public static IP,
  3. My IIS server runnning on the static IP and I can access it via the IP (not the domain name).

In the domain name control panel there is 2 text boxes for nameservers. What should I put there?

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If your DNS is resolving properly then it sounds like you need to enter the URL into the Virtual Server for that site, not the NS entries.

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+1 @Jonathan: I have no idea what Virtual Server is. I am a newbie, could you explain it in a simpler and easy-to-understand sentence? – LaTeX Mar 30 '11 at 7:53
Sure, there's a lot of jargon surrounding "vhosts" and "virtual servers". Essentially instead of your browser asking for an IP address these days it asks for a URL like Your Web Server needs to know which file to serve for and that's one of the reasons that each site must have a Virtual Server. Hopefully this old article will help a bit: – Jonathan Ross Mar 30 '11 at 8:20

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