Could you please provide more infomration regarding your issue? What steps are you taking to create the "new project"? What is the exact text of the error message you are receiving? Have you searched the Knowledge Base at http://support.mercury.com ?
Here is what I am doing
I site Admin
I want to create project.
when I click on project and enter the name click next selected SQL and then clicked on Create.
The error message pops up "Failed to build testdirector database.
Please help me I have to work on that pretty soon.
Without knowing more about your specific TD/SQL environment, I would guess that you may not have the proper SQL connection information (server name, username/password, priviliges, etc.). Talk with your DB Admin. They may be able to assist you further.