DHCP stands for Dynamic Host Configuration Protocol. It is used to allocate IP addresses to a network’s work stations or hosts. A common tool known as DHCP server performs this allocation.

What DHCP does is to “lend” or “lease” addresses to different hosts on particular times. Whenever a host is not able to use a certain IP address for a period of time, such address will be “lent” and allocated to another unit determined by the DHCP server.

DHCP works by using Ethernet (for MAC) or any hardware address in order to establish the IP address allocations. DHCP protocol is founded on BOOTP; therefore, DHCP actually replaces and extends BOOTP.

The Lease Stages of DHCP

  1. The first lease stage of DHCP is the lease request. It is during this stage where a client requests for an IP address through a broadcast.
  2. The second stage (Lease Offer) takes the form of a broadcast message (DHCPOFFER). By then, the requested IP address is blocked from other clients and is made available to the one client it is being offered to.
  3. Should the lease offer be accepted by the client, a DHCPREQUEST message is sent to the service provider.
  4. At this point, the fourth stage, or the lease acknowledgment, takes place. The server sends a DHCPNACK or a DCHPACK if the client requested an unavailable address. However, it is not a permanent status. The client has to renew the lease after 50% of the lease time has expired. If it has passed the 50% mark and has progressed to the 87.5% mark, the client then attempts to contact any other DCHP server. Should this fail and the lease expires, the TCP/IP address will cease to function.


Exclusion ranges exist in order to reserve a bank of IP addresses so that computers needing to use specific IP addresses will be able to access them. This is because client reservation works by making sure a computer gets the same IP address every time it renews or acknowledges a lease.


It is important to take note of the configuration coding system of a DCHP because it is where the time limit is stated. Not using the IP address within the given time means the address will be released and given to other computers.