Dynamic Host Configuration Protocol (DHCP) is an automated configuration protocol for IP networks. DHCP is designed to automatically configure a computer with an IP address, eliminating the need for human intervention. This protocol also keeps track of computers connected to the network and prevents more than one computer from having the same IP address. For all the useful functions DHCP offers, there are some downsides to utilizing this system.
Security Issues
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DHCP automation can be a serious security risk if a rogue DHCP server is introduced to the network. A rogue server isn't under control of the network staff, and can offer IP addresses to users connecting to the network. If a user connects to the rogue DHCP, information sent over that connection can be intercepted or looked at, violating user privacy and network security. This is known as a man in the middle attack, and can lead to serious consequences if confidential information is sent over the rogue DHCP server.
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Failure
Another issue is that if only a single DHCP server is in place, it forms a single critical junction where failure can erupt from a single issue to a system-wide problem. If the server fails, any connected computers that don't already have an IP address will try and fail to obtain one. Computers that already have an IP address from before the server's failure will attempt to renew it, which will lead to the computer losing its IP address. All network access would be lost until the server is restored, leading to potential complications for those connected and needing to communicate with the network.
Additional Configuration
If the network has multiple subnetworks, or segments, a single DHCP server may be insufficient. Making up for this lack requires additional configuration, which means additional time and money spent setting everything up. Each network segment may require its own DHCP server, or a DHCP relay agent. If neither option is viable, all connected routers may have to be configured to Bootstrap Protocol (BootP) broadcasts. BootP is older and less advanced than DHCP protocols, and not all systems may support BootP network protocols.
Windows Server 2003
If your network is running Windows Server 2003, an older Microsoft server operating system, you may have problems with your DHCP client. Not all DHCP clients function properly when connected to Windows Server 2003, although this problem may or may not occur depending on the client being used.