When using Reporting Services in SQL Server Express you will most likely see this error at some point in time "The feature: the edition of reporting services that you are using requires that you use local sql server relation databases for report data sources and the report server database". is not supported in this edition of Reporting Services"

This error rears its ugly head when trying to view the report in Report Manager. You can, however, run the report in the Business Intelligence Studio just fine.

This is because SQL Express installs with an instance name of ServerName\SQLExpress. Visual Studio seems to ignore this instance name if there is only one instance running. When you deploy to the Server and try to run it through the report manager however you will get the "local sql server" error.

To fix this all you have to do is go into the Datasource and modify the connection string to use the instance name... like this - Data Source="ServerName\SQLEXPRESS";Initial Catalog=YourDatabaseName... I hope this helps!