SQL Server should be runningGo to All Programs > Microsoft SQL Server 2005 > Configuration Tools > SQL Server Configuration Manager. Select node SQL Server 2005 Services, under SQL Server Configuration Manager parent node. SQL Server's state should be Running. SQL Server Browser service should also be Running (you can Start/Stop by right click on service name)
Enable TCP/IP in SQL Server ConfigurationGo to All Programs > Microsoft SQL Server 2005 > Configuration Tools > SQL Server Configuration Manager. Select node Protocols for SQLServer(your server's instance name) , under SQL Server 2005 Network Configuration.
TCP/IP's state should be Enabled. (can be Enabled/Disabled by right click on Protocol Name)
App Exception for SQL Server TCP Port in Windows FirewallGo to Conctrol Panel > Windows Firewall > Exceptions (tab). Click button Add Port, enter name and port number 1433. Make sure your entered name is displaying in Programs and Services section, and should be checked while pressing OK button on the tab.
App Exception for sqlbrowser.exe in Windows FirewallIn Firewall window > Exceptions tab, click on Add Program. Locate the sqlbrowser.exe by Browse button. Click OK. At my system, it is located at C:\Program Files\Microsoft SQL Server\90\Shared\sqlbrowser.exe.
App Exception for sqlservr.exe in Windows FirewallSimilarly add sqlservr.exe in Firewall Exceptions. At my system, it is located at C:\Program Files\Microsoft SQL Server\MSSQL.1\MSSQL\Binn\sqlservr.exe.
Enable Remote ConnectionRight click on SQL Server main node in Management Studio, and go to Properties. Select Connections page from Select a Page section. Allow remote connections to this server should be checked.