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During setup I get several errors like the one bellow and none of the service for SQL server get installed. I did quick google search but it seems like the only solution for resolving this issue is re-installation of the whole system which is not an option. Please if you had this problem and resolved it without any drastic measures, please share it.

TITLE: Microsoft SQL Server 2008 R2 Setup

The following error has occurred:

Updating permission setting for folder 'D:\Program Files\Microsoft SQL Server\100\DTS\' failed. The folder permission setting were supposed to be set to 'D:(A;OICI;FA;;;BA)(A;OICI;FA;;;SY)(A;OICI;FA;;;CO)(A;OICI;0x1200a9;;;BU)'.

Click 'Retry' to retry the failed action, or click 'Cancel' to cancel this action and continue setup.

For help, click: http://go.microsoft.com/fwlink?LinkID=20476&ProdName=Microsoft+SQL+Server&EvtSrc=setup.rll&EvtID=50000&ProdVer=10.50.1600.1&EvtType=0xE32A4906%25400x0200CF2B

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    I'd be really curious to see the output of cacls /s on those directories (while the installer is sitting at the Retry box). Or you could try setting the permissions yourself w/cacls just to see what it says. I wonder how setup is doing that. Also, I wonder if the other messages (The process does not possess the SeSecurityPrivilege privilege which is required for this operation.) are at all related. Apparently seSecurityPrivilege = Manage Auditing and Security Log in the Local Security Policy > User Rights Assignment, if that helps any.
    – fission
    Jul 24 '11 at 10:39
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I'm late to the party here, I realize, but I just wandered across this after having the same problem. The comment from @fission led me to the following KB article:

http://support.microsoft.com/kb/2000257

The key information is here:

This behavior is by design. In addition to adding the user account that is running the setup as a local administrator as documented in How to: Install SQL Server 2008 (Setup), the setup user account requires the following default user rights for the setup to complete successfully.

Local Policy Object Display Name (User Right)

  • Backup files and directories (SeBackupPrivilege)
  • Debug Programs (SeDebugPrivilege)
  • Manage auditing and security log (SeSecurityPrivilege)
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This post on MSDN forums worked for me:

I posted something on the Avast forums and got back a response that explains/solves the issue. Avast has a self-defense module that locks down permissions on the C:\Windows\Temp folder. It may lock down other folders, but I don't know that for sure.

This can be disabled. Doing so allows the installation to complete without error. To disable the Avast self-defence module:

Systray -> Right Click Avast -> Open Avast user interface -> Settings -> Troubleshooting -> Enable self-defense module.

Symantec does not cause the SQL installation to fail like Avast does. And, this problem does not happen on Windows 7.

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