Problems loging into the service desk using

We are having the issue that when I use the alias URL feature, I changed it to Servicedesk.<Domain>.local and we set that address with DNS as well.

Now when we use the original server name <Servername>:8080 you are able to log in with no problems with IE but, but when a user uses the Servicedesk.<Domain>.local:8080 they are prompted with a winodws log in prompt first before getting to the ServiceDesk Plus site (using Internet Explorer).

If they put in JUST thier user name and password (from Active Directory) they can log in, but if they put <Domain>\Username and password it hangs and tries to load the last page they were on over and over again (it seems like it keeps trying to log them into the system).

Any ideas why this would happen, we would like to use the Servicedesk.<Domain>.local so others outside of our company can access the site.

Thank you for any help on this matter!