SSRS - Cannot impersonate user for data source

Came across this error. I have SSRS 2008 R2 (native mode) configured with NTLM authentication. Report Server and Database Server are on different machines but same domain. I am trying to run the report by opening a browser on ReportServer but get the following error message.

• An error has occurred during report processing. (rsProcessingAborted)
  • Cannot impersonate user for data source 'Cube'. (rsErrorImpersonatingUser)
    • Log on failed. (rsLogonFailed)
      • Logon failure: the user has not been granted the requested logon type at this computer. (Exception from HRESULT: 0x80070569)

Thanks for any help