A vSphere Distributed Switch provides centralized management and monitoring of the networking configuration of all hosts that are associated with the switch. You set up a distributed switch on vCenter Server system, and its settings are propagated to all hosts that are associated with the switch.
You associate a vSphere Distributed Switch with a datacenter on a vCenter Server system. The networking configuration and management for all hosts that are associated with the switch is centralized on the vCenter Server system. Every associated host has a host proxy switch that contains the networking settings for the host that are configured on distributed switch.
For example, suppose you associate ESXi A and ESXi B hosts to a distributed switch and connect physical NIC vmnic1 of both hosts to uplink 1 on the switch. As a result, vmnic1 of hosts ESXi A and ESXi B is connected to uplink 1 on the distributed switch. On the host proxy switches of both hosts, physical NIC vmnic1 is connected to uplink port 1.
To ensure efficient use of host resources, the number of distributed ports of proxy switches are dynamically scaled up and down on hosts running ESXi 5.5 and later. A proxy switch on such a host can expand up to the maximum number of ports supported on the host. The port limit is determined based on the maximum number of virtual machines that the host can handle.
A distributed switch has one or more distributed port groups. You use distributed port groups to provide networking connectivity to virtual machines and to accommodate VMkernel traffic. You identify each distributed port group by using a network label, which must be unique to the current datacenter. A copy of every distributed port group that you create is also available on the host proxy switches of all hosts that are associated with the distributed switch. The policies that you configure to a distributed port group are consistent for all hosts in the distributed switch.
A VLAN ID, which restricts port group traffic to a logical Ethernet segment within the physical network, is optional.
In addition to vSphere Distributed Switches, vSphere 5 also provides support for third-party virtual switches. For information about configuring the Cisco Nexus 1000v switch, see the Cisco Systems Web site.