Dynamic Host Configuration Protocol (DHCP) is a protocol that lets network administrators centrally manage and automate the assignment of Internet Protocol (IP) addresses in an organization's network. Using the Internet's set of protocols (TCP/IP), each machine that can connect to the Internet needs a unique IP address. When an organization sets up its computer users with a connection to the Internet, an IP address must be assigned to each machine. Without DHCP, the IP address must be entered manually at each computer and, if computers move to another location in another part of the network, a new IP address must be entered. DHCP lets a network administrator supervise and distribute IP addresses from a central point and automatically sends a new IP address when a computer is plugged into a different place in the network.

DHCP uses the concept of a "lease" or amount of time that a given IP address will be valid for a computer. The lease time can vary depending on how long a user is likely to require the Internet connection at a particular location. It's especially useful in education and other environments where users change frequently. Using very short leases, DHCP can dynamically reconfigure networks in which there are more computers than there are available IP addresses.

DHCP supports static addresses for computers containing Web servers that need a permanent IP address.