Subnet masks are easily one of the most confusing elements in the configuration of TCP/IP, although they need not be. In large, complex networks, subnet masks like 255.255.255.0 are used to segment IP addresses from one large network into many smaller ones. For example, a large corporate might be assigned a range of IP addresses by their ISP, and then want to internally divide their network into a number of smaller networks to improve overall performance. At the end of the day, subnet masks are used to help a host determine which portion of an IP address represents the network, and which part represents the host. While the class of an IP address does this, many companies create custom subnet masks that divide their networks beyond typical class boundaries. Based on the combination of an IP address and subnet mask, a host can determine whether a destination host is one the same network, or a different one.
The good news is that for a home network, you really don’t need to put much thought into the subnet mask to be used. Windows will automatically populate the subnet mask field in your TCP/IP configuration after you specify the IP address to be used. Effectively, the value generated is known as the “default” subnet mask based on the class of address you input. So, is you used the Class A IP address 10.1.1.1 for a host, the subnet mask 255.0.0.0 would be allocated automatically. In this case, the “255” means that the first octet of the IP address identifies the network, and the last three octets identify a host. Similarly, entering a Class C IP address of 192.168.1.1 would result in Windows automatically entering the subnet mask 255.255.255.0, in which case the first three octets of the IP address identify the network, and the last represents a host.
For best results, make sure that your PCs are configured with IP addresses in the same network range (such as all starting with 192.168.1), and then let Windows specify the subnet mask automatically. If incorrect subnet masks values are configured, computers on the same network may not be able to communicate.