A DHCP server is the one which provides a network client with a unique IP address, Subnet mask, Gateway and DNS server IP address automatically when it connects to the network.
A DHCP Relay Agent is a computer, server or a Router in a particular subnet which receives a DHCP client broadcast and relays it to a DHCP server in another network or a subnet. A DHCP Relay Agent is more a helper agent here that gets the client a DHCP lease.
Lets say there are multiple subnets in your network with DHCP clients in all being seperated and routed through a router or a firewall and that not every subnet has a DHCP server and the organisation has just one or few centralised DHCP servers.
Given that the routers do not forward IP broadcast messages from one network to another, the only way that the clients get their leases are
1. One DHCP server in each subnet where there DCHP client exist
2. Use a DHCP Relay Agent which can receive and relay BOOTP and DHCP Client broadcast messages.
Most of the routers and Firewalls these days do have support for DHCP Relay Agents. In the event that you are the unfortunate one whose networks are routed using a router not supporting a DHCP Relay Agent then you can choose to use the DHCP Relay Agent support in Windows Server 2000 or 2003 or a Linux server.
DHCP Relay Agent in Cisco Routers
Cisco Routers support DHCP Relay Agents with ip helper-address command. To enable the ip helper-address on an interface that will receive client BOOTP/DHCP broadcasts.
From the Global configuration mode,
Router(config)# interface fa 0/0
Router(config-if)# ip helper-addres 10.10.10.1
Router(config-if)# ip helper-addres 10.10.10.2
NOTE: 10.10.10.1 & 10.10.10.2 are the IP Address of the DHCP server
This will relay all DHCP broadcast messages received on interface FastEthernet 0/0 to the DHCP server 10.10.10.1
If there are more than one DHCP servers then use one helper-address for each DHCP server as above.
Windows Server 2000 and 2003
To setup a DHCP Relay agent in Windows Server 2000 or 2003 install the DHCP relay agent,
NOTE: DHCP Relay Agent cannot be installed on a server which already is running DHCP server
1. Launch Routing And Remote Access Service [RRAS] console.
2. Open IP Routing, right-click General, and select New Routing Protocol.
3. Select DHCP Relay Agent and click OK.
This will install the DHCP Relay Agent.
From the RRAS console,
1. Right-clilck DHCP Relay Agent under IP Routing and select properties
2. Enter the IP Address of the DHCP server and click Add and OK.
3. On the right pane, check if the Network Interface for which the DHCP Relay Agent is required is enabled.
4. If not found, right-click DHCP Relay Agent and click new interface and add the interface.
This should help.