You'll have to edit your httpd.conf file then (find / -name httpd.conf)
Can you post your .htaccess file here, so we might know what you need to change?
Most likely you'll just need to add/uncomment:
AllowOverride None (under Options Indexes FollowSymLinks)
And under (Directory Index) line, uncomment/add
AccessFileName .htaccess
Make sure to have the following below AccessFileName line, so people can't view your .htaccess/.htpasswd files.
CODE
<Files ~ "^.ht">
Order allow,deny
Deny from all
</Files>