Hi,
Here is what i have done so far,

'ssh-keygen -t dsa' on host 1

copied over the "id_dsa.pub" as "authorized_keys" at host2

trying to login using ssh/sftp from host1 to host2 without password,
but the remote host2 asks for the password.
Foll. is the log generated : (apparantly there is nothing relevant that
tells why it has failed!)

================================================== ===============

Script started on Mon 07 Aug 2006 08:44:49 AM IST
]0;vinesh@indus:~[vinesh@indus vinesh]$ ssh -v -v -v us
OpenSSH_3.5p1, SSH protocols 1.5/2.0, OpenSSL 0x0090701f
debug1: Reading configuration data /etc/ssh/ssh_config
debug1: Applying options for *
debug1: Rhosts Authentication disabled, originating port will not be
trusted.
debug1: ssh_connect: needpriv 0
debug1: Connecting to us [64.168.65.81] port 22.
debug1: Connection established.
debug1: identity file /home/vinesh/.ssh/identity type -1
debug1: identity file /home/vinesh/.ssh/id_rsa type -1
debug3: Not a RSA1 key file /home/vinesh/.ssh/id_dsa.
debug2: key_type_from_name: unknown key type '-----BEGIN'
debug3: key_read: no key found
debug3: key_read: no space
debug3: key_read: no space
debug3: key_read: no space
debug3: key_read: no space
debug3: key_read: no space
debug3: key_read: no space
debug3: key_read: no space
debug3: key_read: no space
debug3: key_read: no space
debug3: key_read: no space
debug2: key_type_from_name: unknown key type '-----END'
debug3: key_read: no key found
debug1: identity file /home/vinesh/.ssh/id_dsa type 2
debug1: Remote protocol version 2.0, remote software version
OpenSSH_3.4p1
debug1: match: OpenSSH_3.4p1 pat OpenSSH*
debug1: Enabling compatibility mode for protocol 2.0
debug1: Local version string SSH-2.0-OpenSSH_3.5p1
debug1: SSH2_MSG_KEXINIT sent
debug1: SSH2_MSG_KEXINIT received
debug2: kex_parse_kexinit:
diffie-hellman-group-exchange-sha1,diffie-hellman-group1-sha1
debug2: kex_parse_kexinit: ssh-rsa,ssh-dss
debug2: kex_parse_kexinit:
aes128-cbc,3des-cbc,blowfish-cbc,cast128-cbc,arcfour,aes192-cbc,aes256-cbc,rijndael-cbc@lysator.liu.se
debug2: kex_parse_kexinit:
aes128-cbc,3des-cbc,blowfish-cbc,cast128-cbc,arcfour,aes192-cbc,aes256-cbc,rijndael-cbc@lysator.liu.se
debug2: kex_parse_kexinit:
hmac-md5,hmac-sha1,hmac-ripemd160,hmac-ripemd160@openssh.com,hmac-sha1-96,hmac-md5-96
debug2: kex_parse_kexinit:
hmac-md5,hmac-sha1,hmac-ripemd160,hmac-ripemd160@openssh.com,hmac-sha1-96,hmac-md5-96
debug2: kex_parse_kexinit: none,zlib
debug2: kex_parse_kexinit: none,zlib
debug2: kex_parse_kexinit:
debug2: kex_parse_kexinit:
debug2: kex_parse_kexinit: first_kex_follows 0
debug2: kex_parse_kexinit: reserved 0
debug2: kex_parse_kexinit:
diffie-hellman-group-exchange-sha1,diffie-hellman-group1-sha1
debug2: kex_parse_kexinit: ssh-rsa,ssh-dss
debug2: kex_parse_kexinit:
aes128-cbc,3des-cbc,blowfish-cbc,cast128-cbc,arcfour,aes192-cbc,aes256-cbc,rijndael-cbc@lysator.liu.se
debug2: kex_parse_kexinit:
aes128-cbc,3des-cbc,blowfish-cbc,cast128-cbc,arcfour,aes192-cbc,aes256-cbc,rijndael-cbc@lysator.liu.se
debug2: kex_parse_kexinit:
hmac-md5,hmac-sha1,hmac-ripemd160,hmac-ripemd160@openssh.com,hmac-sha1-96,hmac-md5-96
debug2: kex_parse_kexinit:
hmac-md5,hmac-sha1,hmac-ripemd160,hmac-ripemd160@openssh.com,hmac-sha1-96,hmac-md5-96
debug2: kex_parse_kexinit: none,zlib
debug2: kex_parse_kexinit: none,zlib
debug2: kex_parse_kexinit:
debug2: kex_parse_kexinit:
debug2: kex_parse_kexinit: first_kex_follows 0
debug2: kex_parse_kexinit: reserved 0
debug2: mac_init: found hmac-md5
debug1: kex: server->client aes128-cbc hmac-md5 none
debug2: mac_init: found hmac-md5
debug1: kex: client->server aes128-cbc hmac-md5 none
debug1: SSH2_MSG_KEX_DH_GEX_REQUEST sent
debug1: expecting SSH2_MSG_KEX_DH_GEX_GROUP
debug1: dh_gen_key: priv key bits set: 130/256
debug1: bits set: 1590/3191
debug1: SSH2_MSG_KEX_DH_GEX_INIT sent
debug1: expecting SSH2_MSG_KEX_DH_GEX_REPLY
debug3: check_host_in_hostfile: filename /home/vinesh/.ssh/known_hosts
debug3: check_host_in_hostfile: match line 1
debug3: check_host_in_hostfile: filename /home/vinesh/.ssh/known_hosts
debug3: check_host_in_hostfile: match line 1
debug1: Host 'us' is known and matches the RSA host key.
debug1: Found key in /home/vinesh/.ssh/known_hosts:1
debug1: bits set: 1581/3191
debug1: ssh_rsa_verify: signature correct
debug1: kex_derive_keys
debug1: newkeys: mode 1
debug1: SSH2_MSG_NEWKEYS sent
debug1: waiting for SSH2_MSG_NEWKEYS
debug1: newkeys: mode 0
debug1: SSH2_MSG_NEWKEYS received
debug1: done: ssh_kex2.
debug1: send SSH2_MSG_SERVICE_REQUEST
debug1: service_accept: ssh-userauth
debug1: got SSH2_MSG_SERVICE_ACCEPT
debug1: authentications that can continue: publickey,password
debug3: start over, passed a different list publickey,password
debug3: preferred publickey,keyboard-interactive,password
debug3: authmethod_lookup publickey
debug3: remaining preferred: keyboard-interactive,password
debug3: authmethod_is_enabled publickey
debug1: next auth method to try is publickey
debug1: try privkey: /home/vinesh/.ssh/identity
debug3: no such identity: /home/vinesh/.ssh/identity
debug1: try privkey: /home/vinesh/.ssh/id_rsa
debug3: no such identity: /home/vinesh/.ssh/id_rsa
debug1: try pubkey: /home/vinesh/.ssh/id_dsa
debug3: send_pubkey_test
debug2: we sent a publickey packet, wait for reply
debug1: authentications that can continue: publickey,password
debug2: we did not send a packet, disable method
debug3: authmethod_lookup password
debug3: remaining preferred: ,password
debug3: authmethod_is_enabled password
debug1: next auth method to try is password
vinesh@smp11's password:

================================================== =========
any help is appreciated.

once the problem is solved i'll make a entry for the same..

thanks & regards,
Vinesh