Definition

local area network (LAN)

A local area network (LAN) is a group of computers and peripheral devices that share a common communications line or wireless link to a server within a distinct geographic area. A local area network may serve as few as two or three users in a home office or thousands of users in a corporation's central office. Homeowners and information technology (IT) administrators set up LANs so that network nodes can communicate and share resources such as printers or network storage.

LAN networking requires Ethernet cables and Layer 2 switches along with devices that can connect and communicate using Ethernet. Larger LANs often include Layer 3 switches or routers to streamline traffic flows.

A LAN enables users to connect to internal servers, websites and other LANs that belong to the same wide area network (WAN). Ethernet and Wi-Fi are the two primary ways to enable LAN connections. Ethernet is an Institute of Electrical and Electronics Engineers (IEEE) specification that enables computers to communicate with each other. Wi-Fi uses radio waves in the 2.4 gigahertz and 5 GHz spectrum to connect computers to the LAN.

Legacy LAN technologies, including token ring, Fiber Distributed Data Interface (FDDI) and Attached Resource Computer Network (ARCNET) have lost favor as Ethernet and Wi-Fi speeds increased and connectivity costs decreased.

Understanding local area networking

There are two primary LAN types: wired LANs and wireless LANs (WLANs). A wired LAN uses switches and Ethernet cabling to connect endpoints, servers and internet of things (IoT) devices to the corporate network. For small businesses with only a handful of devices, a wired LAN can consist of a single unmanaged LAN switch with enough Ethernet ports to interconnect all devices. But larger LANs that connect thousands of devices require additional hardware, software and configuration steps to ensure the network is performing optimally. This is where the concept of virtual LANs (VLANs) comes into play.

Because an Ethernet LAN is a shared medium, if an organization has too many devices connected to a single LAN, the amount of broadcast traffic -- which is heard by all devices on the LAN -- can create congestion and bottlenecks. To alleviate the amount of broadcast traffic being sent and received on a LAN, the network can be broken into multiple VLANs. This condenses the broadcast traffic so it's only heard by other devices within that virtual LAN -- not the entire network. This eliminates much of the broadcast overhead that can lead to performance problems.

Although virtual LANs can help reduce broadcast congestion issues, they create another problem. When devices on different VLANs need to talk to each other, a Layer 3 switch is required to transmit and receive traffic between the two LANs. This is known as inter-VLAN routing. Additionally, because large enterprise networks almost always are broken up into hundreds of VLANs, they require routers to be deployed throughout parts of the overall network. Today, vendors integrate Layer 3 routing capabilities into network switches to create a Layer 3 switch. Thus, a Layer 3 switch can perform both switching and inter-VLAN routing functions on a single appliance.

Wireless LANs use the IEEE 802.11 specification to transport data between end devices and the network using wireless spectrum. In many situations, a wireless LAN is preferable to a wired LAN connection because of its flexibility and cost savings, as it isn't necessary to run cabling throughout a building. Companies assessing WLANs as a primary means of connectivity often have users who rely exclusively on smartphones, tablets and other mobile devices.

Setting up a basic local area network

Operating systems (OSes), such as Microsoft Windows, Linux, Apple OS X, Android and iOS, have Internet Protocol Version 4 (IPv4) and IPv6 networking capabilities incorporated into them. Additionally, personal computer (PC), tablet and smartphone hardware all come with an Ethernet port, Wi-Fi chip or both. This means that, as long as the network administrator has a relatively up-to-date laptop or desktop PC, it's fairly straightforward to network machines together onto a wired or wireless LAN.

Setup of a simple wired LAN requires an administrator to connect the end device to a LAN switch using a twisted-pair Ethernet cable. Once connected, the devices can communicate with each other on the same physical LAN or VLAN.

To set up a wireless network, the administrator needs a wireless access point (WAP). The WAP can be configured to broadcast a network service set identifier (SSID) and require devices to authenticate to the network using one of several Wi-Fi authentication techniques. Popular authentication options include Wi-Fi Protected Access 2 pre-shared key and WPA2 Enterprise.

The benefits of using LAN

Local area networks enable devices to connect, transmit and receive information between them. The benefits of LAN technologies include the following:

  • enable access to centralized applications residing on servers;
  • enable all devices to store business-critical data in a centralized location;
  • allow resource sharing, including printers, apps and other shared services;
  • allow multiple devices on a LAN to share a single internet connection; and
  • protect LAN-connected devices using network security tools.

Types of LAN

From an architectural standpoint, a LAN can be considered either peer-to-peer or client-server. A peer-to-peer LAN directly connects two devices -- generally, workstations or personal computers -- together using an Ethernet cable. A client-server LAN consists of multiple endpoints and servers that are connected to a LAN switch. The switch directs communication streams between the multiple connected devices.

Differences among LAN, WAN and MAN

While LAN, WAN and MAN all are networking technologies, there are some distinct differences in terms of technologies, geographical sizes and management responsibilities.

LAN. A local area network connects devices within a relatively close proximity. A LAN can be deployed inside a home, office suite, building or corporate campus. The organization typically owns and maintains the network hardware and cabling. Ethernet -- 1 gigabit per second to 100 Gbps -- is often used and can consist of twisted-pair copper cabling, as well as single- or multimode fiber interconnects.

MAN. Metropolitan area networks are most often used when an organization maintains multiple buildings or locations within a city or municipality. Buildings are typically connected using fiber optic cabling. In most cases, the organization partners with a telecommunications company to provide and manage the MAN service on the client's behalf. Alternatively, the company can choose to lease dark fiber and own or manage the MAN equipment in-house. Modern MAN networks are built using Metro Ethernet, Multiprotocol Label Switching (MPLS) and point-to-point or point-to-multipoint wireless technologies.

WAN. A wide area network connects business locations that are dispersed throughout a state, country or even globally. The organization purchases WAN services from a telecommunications provider that manages the operational status of each WAN link. In most cases, only network traffic that must be transported back and forth between business locations is moved over the WAN. Due to potential latency issues, geographically dispersed locations typically are built with their own internet connection. That way, internet-bound data can be directly sent to and from a branch office, instead of having it backhauled to a central office.

The technologies used to build WANs can include MPLS, Virtual Private LAN Service (VPLS), Ethernet over Synchronous Optical Network (SONET) and satellite-based technologies. Since the carrier typically handles the underlying technologies, to the end customer, the WAN looks like a standard Ethernet connection between locations.

Differences among LANs, MANs and WANs
How LANs, MANs and WANs compare

LAN security

Once a network has been set up, it must be secured. This can be done through security settings in the L2/L3 switches and any existing routers. The use of administration authentication mechanisms, device logs and frequent software updates help to keep LAN equipment secure. Hardware-based security, such as fingerprint recognition, security tokens and full disk encryption, can also be used to enhance network security. Additional security packages for protecting and maintaining the network perimeter can be installed locally or purchased through a software-as-a-service (SaaS) delivery model.

5 popular LAN topologies

Network topologies outline how devices in a LAN are connected, as well as how data is transmitted from one node to another. Popular topologies include the following:

  • star
  • ring
  • mesh
  • bus
  • tree
Network topology

The takeaway

Organizations have many options for implementing networking technologies. Whether they're upgrading an existing business network or setting up a new one that incorporates the technologies examined here, the first step is to choose the right architecture and topology.

This was last updated in February 2021

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