Browse a SharePoint Web Application which uses a fully qualified domain name from a WFE in the farm you will get a 401.1. This error code means there is a problem with the user credentials but nothing to do with invalid credentials.
Windows Server 2003 SP1 introduced a loopback security check. By default this feature enabled in Windows Server 2008. The feature prevents access to a web application using a fully qualified domain name (FQDN) if an attempt to access it takes place from a machine that hosts that application and shows a 401.1 Access Denied from the web server and a logon failure in the event log.
How to Solve this
You need to create a DWORD registry key called DisableLoopbackCheck and set it to 1.