Please always Use Code Tags; I have added them so you can see how much better your post looks.
I haven't seen that error before. Please check your PATH is correct. Please check you don't have any Java installation folders in your CLASSPATH; for a simple application like that it is not necessary to have anything in your CLASSPATH at all. If you have a decent internet connection, try reinstalling Java and update the PATH if you have a new installation location.
What is the name of your source file? Did you call it String.java? That doesn't work.
In Java, the source file must have the name of the public class (or interface) in the file, so if you have a public class MyThread then the source file must be named MyThread.java.