I am developing an application based on .Net Framework 3.5 sp1 and hosted on windows server 2008(64bit).
While browsing wcf service (.svc) locally every things is ok
Try unchecking WCF HTTP activations from "Turn Windows featured on or off" window (See here) and re-install by going to
%windir%\Microsoft.Net\Framework\v3.0\Windows Communication Foundation\
and execute ServiceModelReg -i
ServiceModelReg -i