This is a Joomla 1.0.x issue only. Support is not available for the Joomla 1.0 version and the information is provided as a courtesy only.

Joomla 1.0: You must also activate Joomla SEF URL option for sh404SEF® to be taken into account. If not, Joomla will not even bother about sh404SEF®. This setting is found under the SEO tab, in your Joomla site General configuration.

Please note that when you click on the Yes radio button to activate this function, Joomla will remind you that you must Rename htaccess.txt into .htaccess for SEF URL to work. This is true for (currently) all SEF extensions, except sh404SEF®, which can operate without this .htaccess file. This is the default setting, so you don't have to worry at all about .htaccess file. Sh404SEF will work out of the box on most server configuration.