WordPress MU

Dear friends, while installing first page I am getting this error.

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Creating Database Config File:
Warning: chmod(): Operation not permitted in /home/mbafever/public_html/wpmu/index.php on line 312
DONE

To finish setting up your blog, please fill in the folling form and click Submit.
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But I have assign 777 for above files. I do not know what should I do ??
Any help ??

Anyone please..

friends, I am new at WPMU... any suggestion for above question

If it's the latest build, you shouldn't install MU in the directory WPMU. Move it up one more level to public_html.