This setting allows you to specify applications and filenames that users are restricted from running.

Open your registry and find the key [HKEY_CURRENT_USER\Software\Microsoft\Windows\Curre ntVersion\Policies\Explorer]

Create a new DWORD value and name it "DisallowRun" set the value to "1" to enable application restrictions or "0" to allow all applications to run.

Then create a new sub-key called [HKEY_CURRENT_USER\Software\Microsoft\Windows\Curr
entVersion \Policies\Explorer\DisallowRun] and define the applications the are to be restricted. Creating a new string value for each application, named as consecutive numbers, and setting the value to the filename to be restriced (e.g. "regedit.exe").

Restart Windows for the changes to take effect.

(Default) REG_SZ (value not set)
1 REG_SZ "badapp.exe"
2 REG_SZ "restrict.exe"

Registry Settings
User Key: [HKEY_CURRENT_USER\Software\Microsoft\Windows\Curre ntVersion\Policies\Explorer]

System Key: [HKEY_LOCAL_MACHINE\Software\Microsoft\Windows\Curr entVersion\Policies\Explorer]

Value Name: DisallowRun