Canon EOS rebel XS is not releasing shutter in AF mode of the lense. If I make the MF mode in the Lense, it releases the shutter. I have updated the firmware to 1.06 still I am getting the problem. I have also set the focus locking in the camera, but no result. Is it a problem with Lenses or Flash Memory or camera? Pls. help with the solution.

SOURCE: AF and shutter release failure

There was a lot of discussion of this when the Mk II was new. Many people "fixed" it doing just the things you did. Also, some reported that mounting the lens on another camera "fixed" it. IIRC, in the end it ended up being a lens issue. IS module. Canon can repair.

SOURCE: Canon Rebel XT Auto focus Error 1 Problem HELP

This is a camera body contacts problem Canon Customer support will advise what to do next

SOURCE: Canon Rebel will not shoot in AF mode

the mirror is problem of your camera,it alway been close that why the sensor is functioning properly cause that sensor is working in af mode....check the post at the side of the mirror if not broken and the spring of the mirror if not dislocated....doing this you should removed the lens from the body......

SOURCE: Camera won't shoot with lens on Auto Focus

Talked to canon support, they suggested to send lense in for review/repair. They said it could be the motor, I think it was a gear problem based on the noises and jerkiness of the focusing action while in manual focus (manual focus gave out as well). Cost TBD - "would definately be more than $50. I shopped around and elected to buy a new lense rather than try to hassle with the repair, shipping, insurance, and the wait, etc. Besides, I have a deadline that I need the lense for, so repair at Canon really became a non-option. I think the cost would've been pretty much the same in the end as the new lense, since this wasn't one of the costlier of lenses to begin with.

SOURCE: Auto focus suddenly stopped working

This may not be the same as your issue, but our AF stopped working as well. I tried all the recommended fixes - removing the card and battery, recharging the latter, removing the lens and cleaning the contacts, etc. None of those things worked. However, I then switched to MF, requiring me to turn the barrel, and I realized it was stuck and just needed a little force to get unstuck. Might have been the humidity. Anyway, our problem was solved - AF was back to normal after that.