Changing Permalinks doesent work.

Hi,

I am trying to change the permalinks settings. From Default to Post Name.

However when i do this, the page does not load.

Works: http://local.cv.com/wordpress/?page_id=8

Doesen’t Work: http://local.cv.com/wordpress/about-us/

When i load the second i get this error message.

Not Found

The requested URL /wordpress/about-us/ was not found on this server.
Apache/2.4.7 (Ubuntu) Server at local.cv.com Port 80

Any ideas?