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I have centos 5.3 and I just installated memcached 1.4.2.
I can telnet it fine and do stats, etc., but when I try to connect to it over php I get an error that it can't connect.
It was SELinux.
It would help if you gave the exact wording/screenshot/log-lines. I'm gonna bet its that you don't have the php memcache client library installed. Try this:
yum install php-pecl-memcache
Required, but never shown