Introduction: With the rise of cloud computing, software-defined networking and network virtualization have become key components in network management. Network virtualization provides network administrators the ability to scale resources and handle workloads dynamically without the need to reconfigure physical infrastructure. Virtual Extensible Local Area Network (VXLAN) is an overlay technology ...used for network virtualization that improves network scalability and addresses segmentation limitations. In VMware ESXi* 5.1/5.5, VXLAN provides software-defined networking functionality by overcoming layer 2 boundaries, enabling the creation and management of logical networks on demand and ultimately providing greater network flexibility. VXLAN allows for the creation of logical networks for virtual machines across different physical networks by encapsulating Ethernet frames in a UDP VXLAN header. By encapsulating layer 2 packets, VXLAN effectively allows for the creation of layer 2 networks on top of layer 3 networks. In addition, VXLAN is capable of supporting 16 million layer 2 networks as opposed to only 4096 using VLAN. This document provides an example configuration for VXLAN networks with the Intel® Ethernet Converged Network Adapter X540 (Intel® Ethernet CNA X540) and Intel® Ethernet Converged Network Adapter X520 (Intel® Ethernet CNA X520) in a VMware ESXi 5.5/5.1 environment.