why can’t I connect to W2K server /w W2K pro?

Hello,
I am trying to connect to remote W2K server using W2K Pro via Terminal Services, which told me ‘The local policy of this system does not permit you to log on interactively’. Then, I use a Win 98 laptop, and have no problem logging onto other W2K servers using Term. Serv.
Can anyone help me resolve this connection issues?
Why is it that I am able to log in using WIN98, but not W2K?

When it says ‘The local policy of this system does not permit you to log on interactively’, does not that supposed to mean that no matter which OS one uses, he should not be able to log in.

regards;
sp