OPERATING SYSTEM(S):
Red Hat Enterprise Linux 3 Update 4 for IA32
Red Hat Enterprise Linux 4 for IA32

FULL JDK VERSION(S):
java version "1.5.0_04"
Java(TM) 2 Runtime Environment, Standard Edition (build 1.5.0_04-b05)
Java HotSpot(TM) Client VM (build 1.5.0_04-b05, mixed mode)

DESCRIPTION:
Steps to Recreate:

1. Compile a sample code, DnDTest.java.

================================ DnDTest.java =====================================
import java.awt.BorderLayout;
import javax.swing.*;

public class DnDTest {

public static void main(String[] args) {
JFrame s1 = new JTextAreaTest("Drag Souce - JTextArea");
s1.setVisible(true);
s1.setLocation(100,100);

JFrame s2 = new JListTest("Drag Source - JList");
s2.setLocation(100,400);
s2.setVisible(true);

JFrame t1 = new JTextAreaTest("Drop Target - JTextArea");
t1.setLocation(400,100);
t1.setSize(300, 600);
t1.setVisible(true);
}
}

class JListTest extends JFrame {
public JListTest(String str) {
super(str);
setSize(300, 300);
DefaultListModel model = new DefaultListModel();
for (int i = 0; i < 5; i++) {
model.addElement("item" + i);
}
JList list = new JList();
list.setModel(model);
list.setDragEnabled(true);
getContentPane().add(list, BorderLayout.CENTER);
}
}

class JTextAreaTest extends JFrame {
public JTextAreaTest(String str) {
super(str);
setSize(300, 300);
JTextArea ta = new JTextArea("TEST_STRING");
ta.setDragEnabled(true);
getContentPane().add(ta, BorderLayout.CENTER);
}
}
===================================================================================

2. Run DnDTest with Motif Toolkit.
    
    $ AWT_TOOLKIT=MToolkit java DnDTest

   Then the following three windows come up.

     Drag Source - JTextArea
     Drag Source - JList
     Drop Target - JTextArea
     
3. Drag a string in "Drag Source - JTextArea" window and
  drop onto "Drop Target - JTextArea" window.
   This drag-and-drop works fine.

4. Drag one of items in "Drag Source - JList" window,
  and drop onto "Drop Target - JTextArea".
   When the item is dragged on the JTextArea, however, the cursor
 indicates "Drop is not allowed" <--- PROBLEM!!
   And the drop is finished, the item is copied in the JTextArea.

Result
Cursor indicates drop denied.

Expected Result
Cursor should indicate drop allowed.

Additional Infomation:
With XAWT, the problem does not occur.