AVG Internet Security Firewall Now Blocking All Internet

Hi Dana.
We regret the inconvenience caused.
I'd request you to enable Internet connection sharing mode in AVG firewall and check if the issue is resolved.

Open AVG Internet Security, click Menu -> Settings -> Full Protection -> Enhanced Firewall. On the right hand side, enable the Internet connection sharing mode.

Windows 7 (fully patched), AVG Internet Security subscription, latest software.  Just recently when I booted up my machine and logged in Windows apps could no longer connect to any Internet resources – browsers could not, DropBox could not.  But if I opened a command prompt I could PING and TRACERT to Internet sites just fine.  If I fooled around and disabled/enabled the network adapter in Windows a few times, it would start working.  But still it would not work on the next boot up – and just last night it happened in the evening when the PC had been up and fine for hours.

A friend suggested disabling any firewalls – so I disabled the AVG firewall – everything works within 30 seconds.  Disable the firewall and everything doesn't work (but PING and TRACERT work all the time) within 30 seconds.  I don't like running with no firewall on, but I have to right now.  Has anyone run into this and solved it?

Thanks!

Dana, we have made some improvements with the components of AVG Internet Security.
Hence, this could have happened. For this particular connection issues, we always suggest few changes in settings.
One of which is enabling 'Internet connection sharing mode' which would resolve most of the connectivity problem, if AVG firewall is the reason behind it.
Thank you.