Dynamic Host Configuration Protocol (DHCP) is a network management protocol used to automatically assign IP addresses and other network configuration settings to devices on a network. This process simplifies the management of IP addresses, allowing devices to connect to the network without manual configuration. When a device, such as a computer or smartphone, connects to a network, it sends a request to the DHCP server. The server then assigns an available IP address from a predefined range, along with other necessary information like the default gateway and DNS servers, enabling the device to communicate effectively on the network.