There are typically two reasons for this error:
1. The folder the error mentions does not contain a "default document", like Default.aspx, Index.htm and so on.
2. IIS is not configured to have a Default Document that matches one you have in your root folder. This usually happens when you install IIS after you installed .NET. In that case Default.aspx is not registered with IIS and no Default.aspx default document is present.
To fix the first problem: simply create a file called Default.aspx. To fix the latter, check the Default Documents settings in IIS and then run aspnet_regiis -i from a command prompt in your .NET framework folder. Searching this board for aspnet_regiis should bring up some helpful posts.