Please check if the live server performs some kind of URL rewriting, which results in problems with accessing the requested resource. Is the cache or the session disabled on your server?
Also, you mentioned only the effect under IE. Does the grey box appear when examining the page with other browsers?
In order to provide a more to the point answer I will need additional information about your setup. Please send a live URL to the problematic page, the markup of the RadCaptcha control, the web.config used in your project so that we can learn more about your configuration. If you are not able to send a URL, you can use the screen capture tool Jing
in order to record the issue and the exact message, provided by Fiddler about the missing image.
the Telerik team
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