I’ve seen a few people get into a pickle over this one. When you’re developing and testing locally, you need to set the ‘Local Playback Security’ setting (sometimes referred to as the ‘use network services’ option) depending on whether you wish to access local external files (e.g. XML files, or images) or some other server (e.g. your dev backend server). You can’t access both from a locally running SWF anymore, since it’s a security risk. So here’s how to set that option in Flash CS3 / CS4 or from within FlashDevelop.