If that .qmd file is located in my downloads folder, the render button produces the correctly-rendered file in my browser.
However, if that .qmd file is located on my institution's network, the browser opens with the messaged "Internal server error" displayed. The address bar reads "localhost:6400". Even though this fails to render, it seems that if I check that directory's corresponding output file hello.html it is correct. This means the documents are put together (knitted?quarto'd?) correctly, but the RStudio preview does not work.
EDIT: This is also a problem when using VSCode.
I followed the Quarto VSCode tutorial and after all steps were taken, the render function (Ctrl+Shift+K) worked when the .qmd file was local, but does not work when the file is not local (produces the "Internal server error" message).