I want to secure my selfhosted service on mono with basic authentication. This works with an Authorization header in the http request and can be setup with configuration for the binding. The setting BasicHttpSecurityMode.TransportCredentialOnly only encrypts the header and no SSL certificate is needed. See code below.

[ServiceContract]
public interface IPrintable
{
    [OperationContract]
    void Print(string textToPrint);
}
// service implementation
public class PrintService : IPrintable
{
    public void Print(string textToPrint)
    {
        Console.WriteLine(textToPrint);
    }
}
// selfhosted
static void Main(string[] args)
{
    // address for the service
    var baseAddress = String.Format("http://{0}:1234", Environment.MachineName);
    var host = new ServiceHost(typeof(PrintService), new Uri(baseAddress));
    // binding with encrypted usename/password in header
    var binding = new BasicHttpBinding(BasicHttpSecurityMode.TransportCredentialOnly);
    binding.Security.Transport.ClientCredentialType = HttpClientCredentialType.Basic;
    binding.Security.Message.ClientCredentialType = BasicHttpMessageCredentialType.UserName;
    // create endpoint for serviceontract
    var endpoint = host.AddServiceEndpoint(typeof(IPrintable), binding, "/PrintService");
    // start the service
    host.Open();
    // wait for user to stop service
    Console.WriteLine("Host opened. Press <CR> to end.");
    Console.ReadLine();
    // stop the service
    host.Close();
}

Basic authentication works as follows:

1. The client sends a request
2. The server responds with a HTTP401 (Unauthorized) and the accepted authentication methods in the header [WWW-Authenticate: Basic realm=””]
3. The client resends the request with the Authorization header containing the username and password [Authorization: Basic VGVzdDpQYXNzd29yZA==]
4. The server processes the Authorization header and services the request, the response is a HTTP200 (OK)

Hosting the service on mono 2.6.7 this works as described. But on mono 2.10.8 this is broken. Inspecting with fiddler showed the server responds with a HTTP401 in step 4 without the accepted authentication methods in the header.
See client code below and try for yourself.

// client
static void Main(string[] args)
{
    // address the service is listening on
    var url = String.Format("http://{0}:1234/PrintService", Environment.MachineName);
    var address = new EndpointAddress(new Uri(url));
    // binding with username/password in header
    var binding = new BasicHttpBinding(BasicHttpSecurityMode.TransportCredentialOnly);
    binding.Security.Transport.ClientCredentialType = HttpClientCredentialType.Basic;
    binding.Security.Message.ClientCredentialType = BasicHttpMessageCredentialType.UserName;
    // contract
    var factory = new ChannelFactory<IPrintable>(binding, address);
    // create the proxy with username and password
    factory.Credentials.UserName.UserName = "Test";
    factory.Credentials.UserName.Password = "Password";
    var proxy = factory.CreateChannel();
    // invoke the print operation
    proxy.Print("Hello world");
}

Submitted bug 4993 to xamarin.