From http://learn.iis.net/page.aspx/262/configuring-iis-for-silverlight-applications

1. Go to Start\Administrative Tools and run IIS Manager. See the figure below:

2. Right click on the server name and select Properties. See the figure below:

3. In the Properties dialog box, click MIME Types. See the figure below:

4. In the MIME Types dialog box, click New. See the figure below:

5. In the MIME Types dialog box, enter the 3 following new MIME types:

·  .xap application/x-silverlight-app

·  .xaml application/xaml+xml

·  .xbap application/x-ms-xbap

See the figure below:

The following content is taken from http://weblogs.asp.net/visualwebgui/archive/2008/12/28/developing-and-deploying-a-visual-webgui-silverlight-application.aspx:

Now we need to register the Visual WebGui extensions under the default site in the IIS. Right click on the web site (in this example the “Default Web Site”) and click on properties. Go to the “Home Directory” tab and click on Configuration.

In the application configuration click edit on the .aspx extension and copy the path from the executable textbox. Click the cancel button to close the edit window..

Now click on the Add button to add a new extension. In the executable textbox paste the path that we just copied from the aspx extension and in the Extension text box enter .wgx (don't miss the dot before WGX it’s there for a reason). Last uncheck the Verify that file exists check box. And do the same with the Visual WebGui Silverlight extension .swgx (same here the dot is needed).

If you are asked to apply the extensions on other virtual directories select all and click OK.