535 – Incorrect authentication data” error is usually related to the SMTP User Authentication details you have configured (or not configured) in your email settings. This error is often reported by mail users who maintain multiple mail devices, and forget to update login details in one of their devices. However, in very rare cases 535 Incorrect Authentication Data’ results when mailbox permissions are changed due to migrations, or an account/server update etc. Steps to fix the error are;
Incorrect username format and wrong password may result in this error while sending mails with the incorrect authentication details as the mail server cannot validate the login.
This issue can be resolved by:
You may have to enable the connection encrypted with SSL/TLS. If you have disabled this option, you might get an SMTP error 535 authentication failed message.
If you have authentication methods that are not supported by your mail server, there are chances to show the SMTP error. To resolve the remove IP-based authentication enabled on your account. Even though IP-based authentication is considered to be an uncommon error, it can result in an SMTP error 535 authentication failed message.
Issues such as spamming and payment dues can make your account temporarily or permanently disable. A disabled account can be a reason for authentication failed message. Hence, you should ensure your account is active by checking the status of your account. Do connect with your server support team in case of any issues.
This error is often experienced by users who use multiple mail devices and forget to update login details on one of the devices. Also, this may result when mailbox permissions are changed due to migrations or an account/server update. User should have root access to fix this problem (in the root WHM), which means you should be on VPS/Dedicated hosting account.
To set mail folder permissions in WHM: