SharePoint 2010 Page Viewer Web Part Forcing Download of .htm Files

I recently ran across an issue after upgrading from SharePoint 2007 to SharePoint 2010 where a page that contained a Page Viewer Web Part that displayed a .htm file. Every time the page was rendered, the user was prompted to download and save the file. The page would not display properly, and the site would hang.

I found the answer at Impossible as Possible. This solution saved me hours of digging.

SharePoint 2010 has an enhanced security model. One aspect of this is that the setting for browser file handling is set to strict by default. As explained by Microsoft here, this is by design to prevent malicious scripts from exploiting security.

To resolve the issue simply open Central Administration\Application Management\Manage Web Applications. Scroll down until you see "Browser File handling". Change it from Strict to Permissive as shown below.

You can now view html files in the iFrame as desired.