From JOPX on SharePoint

A typical SharePoint 2010 demo environment has everything installed on a single machine (Office 2010, SharePoint, etc…). Unfortunately this has some side effects – one of the things you might encounter is the fact that it seems that Excel integration does not work correctly anymore. Every time I uploaded an Excel document to SharePoint 2010 and tried opening it using the Edit in Excel option – I got an error stating that the file was corrupt.

Luckily I knew this had something to do with theTrust Center settings. Go to File Options > Trust Center. Next click the Trust Center Settings button. On the new screen which popups – go to Protected View and unselect all the three protected view options displayed on the top of this settings page.

Close Excel and try the “Edit in Excel” option again …

Related post: Getting Office 2010 to work on a single box SharePoint 2010 demo environment