A server that dynamically allocates IP addresses to client machines using the Dynamic Host Configuration Protocol (DHCP). DHCP servers perform the server-side operation of the DHCP protocol. The DHCP server is responsible for answering requests from DHCP clients and leasing IP addresses to these clients.
DHCP servers should have static IP addresses. A DHCP server gives DHCP clients at least two pieces of TCP/IP configuration information: the client’s IP address and the subnet mask. Additional TCP/IP settings can be passed to the client as DHCP options.
To have Microsoft Windows 2000 Server function as a DHCP server, install the DHCP Server service and manage it using the DHCP console snap-in for the Microsoft Management Console (MMC). To have Windows NT Server function as a DHCP server, install the DHCP Server service and configure it using the administrative tool DHCP Manager. Note that a DHCP server should generally not be a DHCP client - that is, it should have a static IP address.
If hosts on a TCP/IP network are randomly losing connectivity with the network one by one, the DHCP server might be down and unable to renew leases for IP addresses obtained by the clients. Without a valid IP address leased to them, DHCP clients cannot communicate over the network.