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What Is DHCP?

Applies To: Windows Server 2003, Windows Server 2003 R2, Windows Server 2003 with SP1, Windows Server 2003 with SP2

What is DHCP?

Dynamic Host Configuration Protocol (DHCP) is a client/server protocol that automatically provides an Internet Protocol (IP) host with its IP address and other related configuration information such as the subnet mask and default gateway. RFCs 2131 and 2132 define DHCP as an Internet Engineering Task Force (IETF) standard based on Bootstrap Protocol (BOOTP), a protocol with which DHCP shares many implementation details. DHCP allows hosts to obtain necessary TCP/IP configuration information from a DHCP server.

The Microsoft Windows Server 2003 operating system includes a DHCP Server service, which is an optional networking component. All Windows-based clients include the DHCP client as part of TCP/IP, including Windows Server 2003, Microsoft Windows XP, Windows 2000, Windows NT 4.0, Windows Millennium Edition (Windows Me), and Windows 98.


  • It is necessary to have an understanding of basic TCP/IP concepts, including a working knowledge of subnets before you can fully understand DHCP. For more information about TCP/IP, see “TCP/IP Technical Reference.”

Benefits of DHCP

In Windows Server 2003, the DHCP Server service provides the following benefits:

  • Reliable IP address configuration. DHCP minimizes configuration errors caused by manual IP address configuration, such as typographical errors, or address conflicts caused by the assignment of an IP address to more than one computer at the same time.

  • Reduced network administration. DHCP includes the following features to reduce network administration:

    • Centralized and automated TCP/IP configuration.

    • The ability to define TCP/IP configurations from a central location.

    • The ability to assign a full range of additional TCP/IP configuration values by means of DHCP options.

    • The efficient handling of IP address changes for clients that must be updated frequently, such as those for portable computers that move to different locations on a wireless network.

    • The forwarding of initial DHCP messages by using a DHCP relay agent, thus eliminating the need to have a DHCP server on every subnet.

Why use DHCP

Every device on a TCP/IP-based network must have a unique unicast IP address to access the network and its resources. Without DHCP, IP addresses must be configured manually for new computers or computers that are moved from one subnet to another, and manually reclaimed for computers that are removed from the network.

DHCP enables this entire process to be automated and managed centrally. The DHCP server maintains a pool of IP addresses and leases an address to any DHCP-enabled client when it starts up on the network. Because the IP addresses are dynamic (leased) rather than static (permanently assigned), addresses no longer in use are automatically returned to the pool for reallocation.

The network administrator establishes DHCP servers that maintain TCP/IP configuration information and provide address configuration to DHCP-enabled clients in the form of a lease offer. The DHCP server stores the configuration information in a database, which includes:

  • Valid TCP/IP configuration parameters for all clients on the network.

  • Valid IP addresses, maintained in a pool for assignment to clients, as well as excluded addresses.

  • Reserved IP addresses associated with particular DHCP clients. This allows consistent assignment of a single IP address to a single DHCP client.

  • The lease duration, or the length of time for which the IP address can be used before a lease renewal is required.

A DHCP-enabled client, upon accepting a lease offer, receives:

  • A valid IP address for the subnet to which it is connecting.

  • Requested DHCP options, which are additional parameters that a DHCP server is configured to assign to clients. Some examples of DHCP options are Router (default gateway), DNS Servers, and DNS Domain Name. For a full list of DHCP options, see “DHCP Tools and Settings.”

Terms and Definitions

The following table lists common terms associated with DHCP.

DHCP Terms and Definitions

Term Definition

DHCP server

A computer running the DHCP Server service that holds information about available IP addresses and related configuration information as defined by the DHCP administrator and responds to requests from DHCP clients.

DHCP client

A computer that gets its IP configuration information by using DHCP.


A range of IP addresses that are available to be leased to DHCP clients by the DHCP Server service.


The process of partitioning a single TCP/IP network into a number of separate network segments called subnets.

DHCP option

Configuration parameters that a DHCP server assigns to clients. Most DHCP options are predefined, based on optional parameters defined in Request for Comments (RFC) 2132, although extended options can be added by vendors or users.

Option class

An additional set of options that can be provided to a DHCP client based on its computer class membership. The administrator can use option classes to submanage option values provided to DHCP clients. There are two types of options classes supported by a DHCP server running Windows Server 2003: vendor classes and user classes.


The length of time for which a DHCP client can use a DHCP-assigned IP address configuration.


A specific IP address within a scope permanently set aside for leased use by a specific DHCP client. Client reservations are made in the DHCP database using the DHCP snap-in and are based on a unique client device identifier for each reserved entry.

Exclusion/exclusion range

One or more IP addresses within a DHCP scope that are not allocated by the DHCP Server service. Exclusions ensure that the specified IP addresses will not be offered to clients by the DHCP server as part of the general address pool.

DHCP relay agent

Either a host or an IP router that listens for DHCP client messages being broadcast on a subnet and then forwards those DHCP messages directly to a configured DHCP server. The DHCP server sends DHCP response messages directly back to the DHCP relay agent, which then forwards them to the DHCP client. The DHCP administrator uses DHCP relay agents to centralize DHCP servers, avoiding the need for a DHCP server on each subnet. Also referred to as a BOOTP relay agent.

Unauthorized DHCP server

A DHCP server that has not explicitly been authorized. Sometimes referred to as a rogue DHCP server.

In a Windows Server 2003 domain environment, the DHCP Server service on an unauthorized server running Windows Server 2003 fails to initialize. The administrator must explicitly authorize all DHCP servers running Windows Server 2003 that operate in an Active Directory service domain environment. At initialization time, the DHCP Server service in Windows Server 2003 checks for authorization and stops itself if the server detects that it is in a domain environment and the server has not been explicitly authorized.

Automatic Private IP Addressing (APIPA)

A TCP/IP feature in Windows XP and Windows Server 2003 that automatically configures a unique IP address from the range through with a subnet mask of when the TCP/IP protocol is configured for automatic addressing, the Automatic private IP address alternate configuration setting is selected, and a DHCP server is not available. The APIPA range of IP addresses is reserved by the Internet Assigned Numbers Authority (IANA) for use on a single subnet, and IP addresses within this range are not used on the Internet.


A configuration that allows a DHCP server to provide leases from more than one scope to clients on a single physical network segment.

Multicast IP addresses

Multicast IP addresses allow multiple clients to receive data that is sent to a single IP address, enabling point-to-multipoint communication. This type of transmission is often used for streaming media transmissions, such as video conferencing.

Multicast Scope

A range of multicast IP addresses that can be assigned to DHCP clients. A multicast scope allows dynamic allocation of multicast IP addresses for use on the network by using the MADCAP protocol, as defined in RFC 2730.


An older protocol with similar functionality; DHCP is based on BOOTP. BOOTP is an established protocol standard used for configuring IP hosts. BOOTP was originally designed to enable boot configuration for diskless workstations. Most DHCP servers, including those running Windows Server 2003, can be configured to respond to both BOOTP requests and DHCP requests.