RDP error: The local policy of this system does not permit you to logon interactively

You may receive the following error message when try to use the Remote Desktop Connection:
"The local policy of this system does not permit you to logon interactively."

This issue occurs because the user account is not a member of the local Remote Desktop Users group. To resolve this issue, add allowed users to the Remote Desktop Users list:

1. Log in the Windows server as Administrator.
2. Click Start, point to Settings, and then click Control Panel.
3. Double-click System, and then on the Remote tab, click Select Remote Users.
4. Click Add type in the user account name, and then click OK.
   
   If you are adding more than one user name, use a semicolon ; to separate the names.

To read more about this solution:
http://support.microsoft.com/kb/289289