Often there are times when you might need to create a SharePoint environment for either demonstration or to do some development, and you do not wish to add your environment to a domain, making it domain dependent.
At the same time, you either want the added functionality of a full SQL installation, or you just want to avoid the size constraint issues caused using the Express edition of SQL.
With MOSS 2007 this was not a difficult proposition. All you had to do was run the SharePoint configuration utilitly and configure a complete install using a local account and point to the local SQL server.
This is no longer the case with SharePoint 2010.
If you try to run the configuration utility after installation completes, you are now greeted with an unfriendly error message stating you can only configure this installation on a domain.
To work around this issue install SQL 2K8 Enterprise SP1 and all the prerequisites, run all updates, and then run the SharePoint 2010 installation.
When the installation completes, close the SharePoint configuration utility when it pops up and instead launch the SharePoint 2010 management PowerShell.
From the management shell, type in "New-SPConfigurationDatabase" and press enter.
Enter the desired credentials when prompted and wait a minute or two for the process to complete.
Once complete, you can close the shell and launch the SharePoint configuration utility again.
This time, select "join an existing domain," and you are on your way, just as before.