My classpath is set to
<code>.;c:\jdk1.2</code>
for both compiling and executing. (I use the -classpath option, and use batch files to compile and execute.) That . part is very important - it says the JVM should look in the current directory as well as the standard library. That may well be your troouble here. Also you may not need the \LIB or \BIN parts - or if you
do need them, include them in addition to a path without them:
<code>.;c:\jdk1.2;c:\jdk1.2\lib;c:\jdk1.2\bin</code>
(probably overkill, but I suppose it depends just how you've got everything set up.)
If that doesn't do it, compile using -g (debug) option and when you run
you should get a slightly more complete error message - in particular, you'd like to know the exact line number it's choking on (evidently it's in the file hello.java). That may provide useful clues. Good luck.