sshd on redhat 6.0

[Gerogi Danov]

hello, I have installed ssh 1.2.3 on RedHat 6.0
after generating machine and user keys, I try to use ssh on the same machine
sshd resides. it adds the machine key, then asks for user and password and
key phrase, and then says 'permission denied', I have known_hosts, also have
authorized_keys, but it always says 'permissions denied' .
what could possibly be wrong?