vinaydwivedi

Window service is authenticated as Network service, tried running it under local service account as well, doesn't work.

Yes, please see below, Just to be sure, if this is not permission issue, I granted create "create global objects" to everyone. 

Could following be required, don't see this being set. var security = new MemoryMappedFileSecurity(); security.AddAccessRule(new AccessRule("everyone", MemoryMappedFileRights.FullControl,AccessControlType.Allow));

Both the issue were from client side. I have switched to Managed version of MemoryMapped files, and able to work as expected with security MemoryMappedFileSecurity added.