You must disable Extended Protection in ADFS 2.0 (Office 365 SSO) to allow IE, Google Chrome and Firefox to Authenticate Using NTLM when using reverse proxies such as TMG and UAG…or external employee access. Read about the security implications of disabling Extended Protection, you can read the Microsoft security advisory here.
In the past, this was a manual process on each server in the farm (for example, this process). ADFS 2.0 requires you to disable IIS Windows extended protection on the ADFS virtual directory “LS”.
This can now be set via PowerShell at the farm level easily using PowerShell.
- Open PoweShell Command Window
- Load ADFS Poweshell SnapIn
- Set ADFS to diable EAP at the farm level
- Restart ADFS and IIS
- Net Stop ADFS
- Net Start ADFS
Hope this helps!
PS – Uploaded to the wiki here.