I am facing this issue after trying to run a Windows application on sharing client side in a workgroup environment, while this application working on server machine fine.
Both the server and the client machines must be configured with the same workgroup name.
You must manually create Windows user accounts for each user on the server with the same password they use to access their workstation.
Once you've got the above setup, create Windows logins in SQL Server for the users that have Windows accounts on the server machine. At that point, they should be able to connect to the SQL Server using Windows Authentication.