sshd_config / failed authentication

[Fabian Anklam]

Dear all,

could someone be so kind to point out to me which settings in
sshd_config have to be changed to allow login from an ssh client
without getting "authentication failed" messages on the console and a
timeout on the guest machine.

My client, putty in this case display the login: dialog, but after
entering the username hangs without ever displaying the password:
dialog

My FreeBSD5.3 Release box ps -aux reveals:

root	722  0.0  0.7  3360 2812  ??  Is   12:12AM   0:00.01 sshd
root	755  0.0  0.8  4720 2920  ??  Is   12:29AM   0:00.05 sshd:
[accepted] (sshd)
sshd	756  0.0  0.8  4792 2936  ??  S    12:29AM   0:00.18 sshd: [net] (sshd)
root	760  0.0  0.1	348  232  v0  R+   12:29AM   0:00.00 grep sshd

and then, after about a minute:

root	722  0.0  0.7  3360 2812  ??  Is   12:12AM   0:00.01 sshd
root	755  0.0  0.8  4912 3072  ??  Ss   12:29AM   0:00.06 sshd: fan
[priv] (sshd)
sshd	756  0.0  0.8  4768 2940  ??  S    12:29AM   0:00.18 sshd: fan [net] (sshd)
root	835  0.0  0.1	348  232  v0  R+   12:30AM   0:00.00 grep sshd

and then, after about a minute again:

[...] sshd[755}: fatal: Timeout before authentication for  192.168.0.10

I did man sshd_config and changed some settings despite not
understanding one word but to no avail so i restored the original.

I tried to consult the handbook, also to no avail.

Help needed and appreciated,

Fabian