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If a client is configured to use DHCP, what happens if no DHCP server is available on the network? Starting with Windows 98, Microsoft Windows clients can use Automatic Private IP Addressing (APIPA). This is not a solution for a large network. It is for use on small LANs, such as a home office with 25 or fewer network nodes.
Simply configure each client computer to use DHCP in the properties page for TCP/IP, and reboot. When the client computer realizes that no DHCP server is on the network (because it’s not receiving any replies from its broadcasts), it will timeout and begin to use APIPA. The scheme in which addresses are allocated is not that complicated.
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