DHCP assigns IP address automatically to client computers/machines. This will show you to set DHCP on windows using dhcpd32.
Download and install dhcpd32 http://tftpd32.jounin.net/
Step 1: Choose what IP addresses you want to use. You should use a unique private IP range that is familiar and easy to use. As an example you can use 192.168.1.100 as Ip range. Use 255.255.255.0 as subnet mask. Use 30 as pool size, pool size determines how many client computers/machines will be automatically assigned with IP addresses.
Step 2: Change your local area connection tcp/ipv4 to 192.168.1.2 and subnet mask 255.255.255.0
Step 3: Open your dhcpd32. In "IP pool starting address" place IP address 192.168.1.100
Step 4: In dhcpd32 Enter the "Size of pool" to 30 and dont write anything on "Boot File" and "WINS/DNS Server" just leave it blank, This is for advanced users. Also dont touch "Domain Name" and "Additional Option".
Step 5: subnet mask must be set to "Mask". This is your subnet mask 255.255.255.0
Step 6: Press "Save".
Step 7: Make sure all your client computers/machines are set to Obtain an IP address automatically.
Your done! you have just set up your DHCP server!