Dynamic Host Configuration Protocol Explained

What Is DHCP? Dynamic Host Configuration Protocol Explained

Learn more about the Dynamic Host Configuration Protocol, how it works and what its key components are. Also, discover the advantages and disadvantages of DHCP.

The Dynamic Host Configuration Protocol (DHCP) is a network management protocol that dynamically assigns Internet Protocol (IP) addresses (both IP version 4 and 6) and other network configuration parameters to devices within a network. DHCP works also as a communications protocol as it handles requests between a server and a client.

When new devices appear on the network, they receive unique IP addresses. The addresses can be assigned by the network administrator manually or dynamically. However, when the local network has multiple devices, it becomes inefficient to allocate IP addresses by hand; thus, the DHCP protocol comes to the rescue.

On a residential network, a router is a DHCP server that uses DHCP to assign IPs and send important information. Meanwhile, large enterprises set up dedicated computers for implementing DHCP servers.

DHCP is an Internet Engineering Task Force (IETF) standard based on the Bootstrap Protocol (BOOTP). These two protocols share similar functionalities. Both DHCP and BOOTP acquire IP addresses and client configuration parameters. The main difference is that DHCP assigns IP addresses dynamically, and BOOTP supports static configuration.

The Dynamic Host Configuration Protocol (DHCP) is a network management protocol that dynamically assigns Internet Protocol (IP) addresses to devices within a network. DHCP also handles communication requests between servers and clients. On residential networks, routers act as DHCP servers to assign IPs and send important information. Meanwhile, large enterprises set up dedicated computers for implementing DHCP servers. DHCP saves time, money and increases security compared to other methods of allocating IP addresses manually or statically.

What are the components of DHCP server?

Before diving deeper into the technicalities of DHCP, it’s important to understand its components. Let’s overview them briefly.

  • DHCP server: A DHCP server can be either a server, dedicated computer or router that manages network configuration information, including IP addresses.

  • DHCP client: A DHCP client is a network device that communicates with the DHCP server to receive the configuration information.

  • DHCP relay agent: A DHCP relay agent is a host or a router that sends requests and replies between the local DHCP clients and a remote DHCP server. A relay agent handles all networks’ requests when only a single DHCP server is present for several LANs.

  • Default gateway address: A default gateway, also known as the gateway address, is the node that forwards information between local networks or local subnets and the internet.

  • IP address pool: An IP address pool is a list of all IPs that are available for allocation.

  • Subnet mask: Subnet masks are the segments of an IP address. IP addresses are divided into subnet masks to differentiate between network and host bits. Thus, a subnet mask allows a host to determine the exact network it currently exists in.

  • DHCP options: DHCP has numerous configurations, which are called options. Some of the more common DHCP options include:

Option 3 (router option)

Option 6 (DNS server option)

Option 33 (static route option)

Option 51 (IP address lease option)

  • Lease Time: The lease time defines the period, during which the client can use the IP address that was assigned to it.

DHCP is a protocol that helps devices on a network to configure and communicate with each other. It's made up of several components, including the DHCP server, client, relay agent and default gateway address. Additionally, it has various configuration options which include things like the router option, DNS server option and static route option. The lease time defines how long a device can use an IP address that was assigned to it by the DHCP server.

What is DHCP lease?

DHCP lease refers to the specific time period during which a device can use an assigned IP address. If the DHCP client wants to keep using the IP address after this time expires, it has to send a request for renewal to the server. Otherwise, the server will release the address at the end of its lease term.

How does DHCP work?

The Dynamic Host Configuration Protocol, or DHCP, is a process that helps assign IP addresses to devices on a network. It operates in four stages: discovery, offer, request and acknowledgment. This allows for an efficient allocation of IP addresses and streamlined communication between devices.

Server discovery

The Dynamic Host Configuration Protocol is a process used by devices to automatically obtain IP addresses and other network settings. The protocol helps devices communicate with DHCP servers, which in turn provide the necessary information for setting up a network connection. Before it can access network services, the client broadcasts DHCP messages to find authoritative DHCP servers. If a client and DHCP servers exist on different LANs, DHCP relay agents relay messages to facilitate communication.

IP address lease offer

The Dynamic Host Configuration Protocol (DHCP) responds to the discovery message by broadcasting a DHCP offer message. The DHCP offer message contains configuration information such as the client’s MAC address, specific IP address offered, subnet mask, default gateway IP address, DNS server IP address, lease time and the DHCP server IP address.

IP lease request

After the client receives IP configuration information, it sends a DHCP request message for the offered IP address. If it receives multiple offers, it only accepts one and then performs a gratuitous ARP request to see if no other hosts are using the chosen IP address. The client must include which server's offer it has selected in the request message and inform others to withdraw their offers.

IP lease acknowledgment

DHCP responds to the request during this final stage by resending the IP address information. The client performs configurations, and then it can connect to the internet with its unique IP address.

What are the benefits of DHCP?

DHCP has several important benefits. The Dynamic Host Configuration Protocol can:

  • Improve IP management

  • Prevent IP address conflicts

  • Increase efficiency

  • Save time and money

The main reason network administrators implement DHCP is to simplify IP address management. When a new device joins the network, DHCP allocates the IP addresses automatically, which means that the network administrator doesn’t need to manually configure each device.

Compared to manual IP allocation, DHCP helps save a lot of time, especially for large enterprises. It also saves money and other resources because companies are not required to have a dedicated expert constantly overseeing IP management and allocation.

Furthermore, when network administrators assign IPs manually, the chances of IP conflicts increase. It is particularly common when a static IP address is in use. No two hosts can have the same IP address on one network, and DHCP performs requests to ensure that IP conflicts don’t happen. A human can easily make this mistake and assign the same IP address twice.

In addition, DHCP can implement dynamic IP addresses. You have this kind of IP address assigned temporarily, and DHCP changes it automatically, which is why it is considered to be more secure than a static IP address.

The Dynamic Host Configuration Protocol (DHCP) is a network protocol that enables devices to automatically obtain an IP address from a server. DHCP simplifies IP address management and can save time and money. It also helps prevent IP conflicts, assigns dynamic IP addresses, and improves efficiency.

What are the downsides of DHCP?

DHCP is a protocol that allows devices to connect to networks quickly and easily. However, it has some security flaws which can pose risks for businesses. These include the possibility of unauthorized clients being assigned IP addresses, as well as cyberattacks such as DoS or MITM.


The Dynamic Host Configuration Protocol assigns IP addresses to devices in a network dynamically, which optimizes the IP addressing and improves management. The protocol operates in four stages: discovery, offer, request and acknowledgment. In the discovery stage, a device searches for DHCP servers; in the offer stage, a dedicated DHCP server sends back configuration information including an offered IP address and other pertinent details; during the request stage, devices send requests for new IP addresses to accept them; finally, in the acknowledgement stage, servers respond with more configuration information. Implementing DHCP is beneficial because it increases efficiency while saving time and money. That is why DHCP is beneficial for both enterprises and small networks.