Understanding ASP.NET Configuration
Configuration in ASP.NET is based on a series of XML-based files that are hierarchical in nature. Each server contains a master (or root) configuration file called machine.config that is stored at the path %windir%\Microsoft.NET\ Framework\%version%\CONFIG\machine.config. (See the illustration that follows, which shows how the path would look for the Visual Studio .NET Final Beta on Windows Server 2003. The version number for the final release will be different.) This master configuration file contains the default settings for all ASP.NET applications on that server. This file also contains settings for machine-wide configuration (such as assembly binding and remoting channels), as well as other settings. Use caution when you edit this file to avoid inadvertently making changes that affect other applications.
Changes to configuration file settings are detected automatically by the ASP.NET runtime and integrated into the cached configuration settings for the application. When a change is made, all new requests for resources within the scope of a given configuration file use the new configuration settings automatically.