Help - can't get Friendly URLS to work

When I turn on Friendly URLs only the home page works. The other pages give me a "not found" server error. When I hover over the links the paths look correct. I really need all ideas of where I can look for the problem.

I have set the htaccess file to the following. This installation is in a subdirectory.

Options +FollowSymlinks
RewriteEngine On
RewriteBase /subfolder/
RewriteCond %{HTTP_HOST} !^www\.mydomain\.com [NC]
RewriteRule (.*) http://www.mydomain.com/$1 [R=301,L]

# The Friendly URLs part
RewriteCond %{REQUEST_FILENAME} !-f
RewriteCond %{REQUEST_FILENAME} !-d
RewriteRule ^(.*)$ /subfolder/index.php?q=$1 [L,QSA]

Thanks!

RewriteRule ^(.*)$ /subfolder/index.php?q=$1 [L,QSA]

Not sure you need to define the /subfolder/ again.
Might be worth a try.

Rewrite base is all you need to change. Just leave the RewriteRule as