Dynamic Host Configuration Protocol provides a means for a central computer to assign network addresses and information to individual computers as needed. Enabling this protocol allows WinProxy to perform as a DHCP server. You may have noticed in your network TCP/IP settings that you have the choice of assigning a static IP address yourself, or choosing Obtain an IP address automatically. With the latter, that computer broadcasts a DHCP request when its network programs start up; if there is a DHCP server on the network, that server will respond with settings for the requesting machine. A DHCP server can provide IP address, subnet mask, and gateway address information.

In addition, if you have DNS disabled on that card, then the DHCP server provides DNS settings, including Server Search order, domain name, and host name (that is because, in this case, the disabled setting is more akin to "obtain automatically"). WinProxy will use a pool of numbers based upon the IP address and subnet mask of the internal network card on the WinProxy machine. It uses some simple rules to make these assignments:

1. Lowest first. The lowest number in the range is assigned first.

2. NameList assignments. you can preassign specific numbers to specific machines by using the NameList function (part of the DNS protocol settings). WinProxy will assign numbers to computers as shown there, and will not give a preassigned number away until it must. As an example, if your namelist has the following entries:

   TimothyO	90.0.0.7
   SamanthaR	90.0.0.8

   Then the "SamanthaR" computer will be assigned 90.0.0.8 even if WinProxy has not yet reached that number. On the other hand, if those computers are not yet online when WinProxy reaches those numbers, it will skip them and continue with the next non-preassigned number.

3. Give it if you've got it. If WinProxy runs out of numbers to assign, it starts assigning unclaimed NameList numbers, lowest first.

DHCP will also work when WinProxy is installed on a multi-homed machine (one with more than one internal network connections); each subnet will get the appropriate information assigned.

The only static IP address(es) that you must have are the internal network connections on the WinProxy machine. The remainder of your local machines can get their TCP/IP settings automatically if you wish. It does not hurt anything at all to run the WinProxy DHCP server even when your client machines do not need the service. For most folks, the more relevant question is whether they want their client machines to use the services (you can of course mix-and-match, having some machines with static TCP/IP settings and others receiving settings dynamically from WinProxy).

Upside to Using DHCP	Downside to Using DHCP
It is really easy. You do not have to configure any of those myriad TCP/IP thingies.	The WinProxy machine must be on whenever two client machines need to communicate via TCP/IP: (a) File and Printer Sharing and Network Neighborhood do not rely on TCP/IP. (b) Windows 98 machines assign themselves default numbers when a DHCP server is not present, so they could converse anyway.
No mistakes. You need not understand what all those thingies mean. You do not have to troubleshoot pesky TCP/IP misconfigurations.	User restrictions are harder to configure. Actual TCP/IP addresses, which use wildcards, are more flexible if you have to configure many user restrictions. Each computer with a dynamically assigned address must be listed separately by name (although NameList can be a way around this).
What settings? Months from now, when you add another machine, you will not have to remember settings for the other machines.	Internal servers (mail, web, or FTP) should have a static IP address assigned.