PuTTY – Fix ‘No Supported Authentication Methods Available’ Error

I have the same exact problem described in this thread, but the answer accepted there is not the right one for me, because the user's home directory is local.

I think that I configured everything properly on the client side (Windows 7, PuTTY's PAGEANT, PUTTYGEN and PLINK), yet I don't seem to make the public key mechanism work (password based ssh login works). I followed all the steps, cues and hints in:

• How To Configure SSH Keys Authentication With PuTTY And Linux Server
  In 5 Quick Steps
• SSH Public Key Authentication

I now suspect that I may be missing something on the server side (Linux, sshd), so I am posting the current /etc/ssh/sshd_config content:

Protocol 2
SyslogFacility AUTHPRIV
RSAAuthentication yes
PubkeyAuthentication yes
AuthorizedKeysFile      .ssh/authorized_keys
PasswordAuthentication no
PermitEmptyPasswords yes
ChallengeResponseAuthentication no
UsePAM yes
X11Forwarding yes
Subsystem       sftp    /usr/libexec/openssh/sftp-server

Any idea what I am doing wrong?

UPDATE: I found a tip for running sshd in debug mode, and here is the output:

/home/winwin> /usr/sbin/sshd -d
debug1: sshd version OpenSSH_4.2p1
debug1: read PEM private key done: type RSA
debug1: private host key: #0 type 1 RSA
debug1: read PEM private key done: type DSA
debug1: private host key: #1 type 2 DSA
debug1: rexec_argv[0]='/usr/sbin/sshd'
debug1: rexec_argv[1]='-d'
debug1: Bind to port 22 on ::.
Server listening on :: port 22.
debug1: Bind to port 22 on 0.0.0.0.
Bind to port 22 on 0.0.0.0 failed: Address already in use.
debug1: Server will not fork when running in debugging mode.
debug1: rexec start in 4 out 4 newsock 4 pipe -1 sock 7
debug1: inetd sockets after dupping: 3, 3
Connection from 192.168.1.8 port 49828
debug1: Client protocol version 2.0; client software version PuTTY_Release_0.60
debug1: no match: PuTTY_Release_0.60
debug1: Enabling compatibility mode for protocol 2.0
debug1: Local version string SSH-2.0-OpenSSH_4.2
debug1: permanently_set_uid: 74/74
debug1: list_hostkey_types: ssh-rsa,ssh-dss
debug1: SSH2_MSG_KEXINIT sent
debug1: SSH2_MSG_KEXINIT received
debug1: kex: client->server aes256-ctr hmac-sha1 none
debug1: kex: server->client aes256-ctr hmac-sha1 none
debug1: SSH2_MSG_KEX_DH_GEX_REQUEST_OLD received
debug1: SSH2_MSG_KEX_DH_GEX_GROUP sent
debug1: expecting SSH2_MSG_KEX_DH_GEX_INIT
debug1: SSH2_MSG_KEX_DH_GEX_REPLY sent
debug1: SSH2_MSG_NEWKEYS sent
debug1: expecting SSH2_MSG_NEWKEYS
debug1: SSH2_MSG_NEWKEYS received
debug1: KEX done

debug1: userauth-request for user winwin service ssh-connection method none
debug1: attempt 0 failures 0
debug1: PAM: initializing for "winwin"
debug1: PAM: setting PAM_RHOST to "win7client"
debug1: PAM: setting PAM_TTY to "ssh"
Failed none for winwin from 192.168.1.8 port 49828 ssh2
debug1: userauth-request for user winwin service ssh-connection method publickey
debug1: attempt 1 failures 1
debug1: test whether pkalg/pkblob are acceptable
debug1: temporarily_use_uid: 513/513 (e=0/0)
debug1: trying public key file /home/winwin/.ssh/authorized_keys
Authentication refused: bad ownership or modes for directory /home/winwin
debug1: restore_uid: 0/0
debug1: temporarily_use_uid: 513/513 (e=0/0)
debug1: trying public key file /home/winwin/.ssh/authorized_keys
Authentication refused: bad ownership or modes for directory /home/winwin
debug1: restore_uid: 0/0
Failed publickey for winwin from 192.168.1.8 port 49828 ssh2
Received disconnect from 192.168.1.8: 14: No supported authentication methods available
debug1: do_cleanup
debug1: PAM: cleanup
debug1: do_cleanup
debug1: PAM: cleanup

Now, I do notice the two bad ownership or modes for directory /home/winwin messages but I checked the ownership or modes for directory /home/winwin and AFAICT they're OK:

/home> ls -lad winwin
drwxrwxr-x  21 winwin winwin 4096 Jul 13 21:24 winwin

And:

/home/winwin> ls -lad .ssh
drwxr-xr-x  2 winwin winwin 4096 Jul 14 12:06 .ssh

And:

/home/winwin/.ssh> ls -lad *
-rw-r--r--  1 winwin winwin 210 Jul 14 12:06 authorized_keys
-rw-r--r--  1 winwin winwin 210 Jul 14 01:58 authorized_keys.pub
-rw-r--r--  1 winwin winwin 394 Jul 14 01:57 authorized_keys.pub.orig

What could possibly be wrong?

UPDATE II: I tried chmod 600 as suggested in the answer below:

/home/winwin> ls -lad .ssh
drw-------  2 winwin winwin 4096 Jul 14 13:13 .ssh

And:

/home/winwin/.ssh> ls -lad *
-rw-------  1 winwin winwin 210 Jul 14 12:06 authorized_keys

But it still doesn't work. Why am I still getting the Authentication refused: bad ownership or modes for directory /home/winwin error?