Forwarding local mail

[Shaad]

Hello, I just put a new server on my network, I start sendmail, but when I try to inject a message vi telnet, or mail is generated locally on the box. It does notleave the server.

I see the following in my maillog :
2.j52L1rAQ013396@localhost.localdomain>, proto=SMTP, daemon=MTA, relay=accounting [127.0.0.1]
Jun 2 14:02:12 accounting sendmail[13398]: j52L1rAQ013396: SYSERR(root): mail.*domain*.com. config error: mail loops back to me (MX problem?)
Jun 2 14:02:12 accounting sendmail[13398]: j52L1rAQ013396: to=terri@*domain*.com, delay=00:00:04, xdelay=00:00:00, mailer=esmtp, pri=30006, relay=mail.*domain*.com. [192.168.140.142], dsn=5.3.5, stat=Local configuration error
Jun 2 14:02:12 accounting sendmail[13398]: j52L1rAQ013396: j52L2CAQ013398: DSN: Local configuration error
Jun 2 14:02:12 accounting sendmail[13398]: j52L2CAQ013398: to=root, delay=00:00:00, xdelay=00:00:00, mailer=local, pri=61030, dsn=2.0.0, stat=Sent

I replaced my domain name in the applicable places. Does anyone have any ideas? when i do a dig, It finds the correct MX and IP for mail.mydomain.com

Thanks!!!!