Avoid Login Prompts With AD Authentication

From SharePoint Knowledge Base

If you have SharePoint installed in an Active Directory environment your credentials will usually be passed along automatically. This means that you won't be prompted to log in when browsing to your SharePoint site. However, there are certain situations where your credentials aren't passed automatically. That can be extremely annoying for users especially when opening working with documents where you may be prompted again.

Manual Configuration

This is almost always resolved by configuring Internet Explorer to pass credentials automatically. Let's say your site is hosted at http://sharepoint.mycompany.com. To configure IE to pass credentials automatically, follow these steps:

1. Click Tools > Internet Options
2. Click the Security tab
3. Select the Local intranet zone and click the Sites button
4. Click the Advanced button
5. Type the URL to your SharePoint site (i.e. http://sharepoint.mycompany.com into the box and click Add

That's it. Your credentials should now be passed automatically.

Group Policy

This can be done using a group policy as well. I don't have the specifics but if anyone out there does, please post it here.