Here's the scenario: Two PCs running XP home on a small business LAN. Each has a unique APIPA type addresse. Both use a DSL router (vendor unknown at the moment) for internet. Internet works. Why they get 169.254.x.x has yet to be determined but each was on a separate subnet before I staticed one to a common subnet to establish a basic link for file sharing. For simple PC-PC I presume it is ok to leave the ip's as is-yes or no?

The router is usually setup as a DHCP server and the IP address/subnet on the PC's is set to receive an IP address etcetc from the DHCP server. Maybe reset the router back to factory default if it is causing a problem, then run the Networking Wizards on the XP PC's

What about maintaining the 169.254.x.x scope? I presume that would be purely a judgement call. I found it odd that each PC pulled a different subnet but making one static corrected the lack of connectivitiy. Resetting the router to factory default isn't a bad idea but may not be entirely necessary.

"Why they get 169.254.x.x has yet to be determined " It would appear you have the clients set to get ip dynamically but you have no dhcp server. My suggestion would be to go into the router and turn it on. You can set the scope to 169.x.x.x but you lose the ability to detect the if there is a break in the chain [bad cable/bad lan port/malfunctioning router/no dhcp server] because THAT'S what causes a machine to give out a 169.x.x.x address. Something between it and the dhcp server is a problem Golly gee wilerkers everyone! Learn to Internet Search

I was called in because whoever worked on their mini-LAN either didn't know what they were doing or left an incomplete job. I agree that leaving the 169 scope would essentially defeat the inherent problem solving feature but the fact that by linking the subnets we reestablished connectivity says the router is functioning. I worked with them over the phone this time so a house call is the next logical step. Thanks again!

when you had internet access you knew the router was working. You just don't have a dhcp server which the router can provide and that way you know all the pcs are on the right subnet. Golly gee wilerkers everyone. Learn to Internet Search