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How to set folder permissions for ApplicationPoolIdentity

ApplicationPoolIdentity does not show up in folder permissions by default, but it's easy enough to set up with the icacls tool.

Run the following command, replacing 'foldertobemodified' with the correct directory path:

icacls c:foldertobemodified /grant "IIS APPPOOLDefaultAppPool":(OI)(CI)(RX)


Now you should be able to open Folder Permissions dialog and set your rights manually.