>> the primary key is on (DEipUserID+DEipServiceID )
Ok, the query is incorrect then. Because by definition, when you partition on the primary key, every single one is unique and will return row number of 1.
Going back to the question,
[For the first row islatest =1, 2nd row arrives go to prev record change IsLtatest = 0 and put IsLatest = 1 for new record.]
And one query you had above, I suspect you actually want, what is the definition of "2nd row", is it "2nd and thereafter rows per DEipUserID+DEipServiceClientID"? Whatever it is, partition by that combination.
;with tmp as (
select deipuserid, deipserviceid, islatest, rn=row_number() over (partition by deipuserid, deipserviceClientid order by eipinsertdttm desc) from dbo.FactUserClientUse)
update tmp set islatest=case when rn=1 then 1 else 0 end
