Can't share folders

I'm trying to network a desktop computer with a new laptop. Both are Windows 7 Home Premium computers. The desktop lists the laptop in the network, but when I try to access folders I'm sharing, I am prompted for a password. The laptop has no password since I log on without it. I've also tried the homegroup password, but it's still not accepted. I've tried other passwords I've used here and there for things, but none of them works.

Furthermore, the laptop doesn't see the desktop. Only the desktop lists both itself and the laptop in the network. The laptop lists only itself.

The laptop has options for creating a homegroup, but the desktop does not, which seems odd to me since they're both Windows 7 Home Premium, and I thought W7 HP could not create a homegroup. In any case, I just want to share several folders with both computers over my home network.

Could this be a firewall issue with the laptop? I see plenty of resources for allowing new programs through the firewall, but how, then, do I allow the other computer through?

If I could solve the password mystery, it might work. Help, please. Puh-leez!
Thanks.

James: What, exactly, needs to be passworded--the administrative account? I did that on the laptop, but the desktop is still not accepting the password. Any ideas? Thanks.

Well, that was easy! My network is up and running and sharing between my desktop and laptop.

Thank you, James, for the assist.

In case anyone else has this same problem, I just turned off password-protected sharing! No need for a homegroup.