Apache gurus - need mod_rewrite for just 1 virtual directory

[bob4432]

i have uncommented the mod_rewite function in the beginning of the httpd.conf so the mod_rewrite does start and have the .htaccess fiels that is in the directory i want to allow it starts of by the RewriteEngine on command

the error says - RewriteEngine not allowed here

the only thing i can think of is that my main apache install is on my c drive where the websites are on the d drive....would this be an issue?

any ideas?