AllowOveride
To allow local .htaccess files to overide your global default settings defined in httpd.conf you need to change the "AllowOveride" settingof the default /var/www/html website
# vi /etc/httpd/conf/httpd.conf
and find the section beginning
<Directory "/var/www/html"> Options Indexes FollowSymLinks
change
AllowOverride None
to
AllowOverride All
Order allow,deny Allow from all </Directory>
save the file and then
# service httpd restart