I was trying to add an reserved IP address, I get this error repeatedly. Quick Internet search took me to http://msdn.microsoft.com/en-us/library/ms847672.aspx. It Says,
Explanation:
Stand-alone DHCP servers are not allowed to operate when Active Directory is operating. This is to prevent unauthorized servers operating on the network. A DHCP server initializes and starts providing DHCP services to clients only if the server finds its IP address in the authorized list for each of the enterprise roots reported by other DHCP servers. If it does not find itself in the authorized list for each of the reported enterprise roots, it does not initialize and the DHCP service is stopped.
User Action:
Verify whether the DHCP server is supposed to be part of a directory service enterprise or operating as a stand-alone server. If the DHCP server should belong to a directory service enterprise, reconfigure the server to be a domain controller or member server of the directory service enterprise, as applicable.
But, my DHCP server is authorized, alright. It is dishing out IP addresses, no problem.
You know, that’s one of those moments I felt stupid shame when I found the issue. The IP address I was trying to reserve is OUT OF DISTRIBUTION range, meaning it was in exclusion from distribution range. What a dump error message? I think those MS developers revenge on Sys Admins are very revolting.
Anand, the Architect 
The problem is most likely, your trying to reserve an IP address is not in the distribution range. To Fix this you should add that address to the distribution range, if you do want that address to be distributed add an exclusion for it. For instance at my company we distribute address from .32 to .254, but we exclude from .129 to .254 (which is the range for reservations used to allow internet access with the mask 255.255.255.128)