- The configuration token method is vulnerable to interception, and
- The delayed authentication mechanism is vulnerable to DDoS floods.
For example, DHCP_Gobbler is a proof of concept tool that attacks RFC 3118 by grabbing all available DHCP addresses, preventing allocation to legitimate new machines.
To learn more about DHCP improvements related to security and more, visit the IETF's DHC working group page -- for example, see Internet Drafts regarding DHCP authentication with IPv6 and DHCP Relay.
Note that DHCP can be used by any kind of IP network, including wireless LANs. Wireless LANs are inherently more vulnerable to interception and flooding than privately-operated Ethernet LANs. Link encryption (WPA/WPA2) can be used to prevent DHCP request interception on a wireless LAN. Preventing flooding is trickier, since you can't really prevent wireless stations from transmitting. However, you CAN stop transmitted packets from reaching your DHCP server -- for example, by using 802.1X port access control.
This was first published in February 2005