How to set a Wireless Router as an Access Point

I've often found it useful to get just the wireless functionality out of a WiFi router and reuse it as an access point. Wireless routers seem more common, and are often priced even lower than wireless access points. Adding an access point to a wired network already in place, or to one where the main NAT router is provided by the ISP is usually the easiest solution. However, introducing a second NAT router on the network is not a good idea, especially without some tweaking to set it up correctly.
Instead of using your wireless router as intended (NAT routing, DHCP client/server, PPPoE client, etc.), converting it into a wireless access point will save you a lot of headackes and make the configuration much simpler.
In essence, the new wireless router/access point needs to be configured to use a LAN IP address in your network range (the same subnet as your other devices), and you need to connect one of its LAN ports to the existing gateway/router. Do not use the Internet/WAN port on the wireless router to be used as an acces point.
More detailed step by step instructions on how exactly to convert and use your wireless router as an access point are below:
 
Step 1: Find the IP addresses of your existing gateway/router and clients
You need to find the internal IP address of your existing modem/gateway/router that connects your LAN to the internet. Under Windows, the easiest way to do this is drop to command prompt (Start > Run > type: cmd) and type: ipconfig

In this example, my ISP-provided gateway/router (the "Default Gateway") is set to 192.168.1.1. My client computer is at 192.168.1.10

The "IP address" line in the above figure shows your computer's IP, while the "Default Gateway" is your main existing router that provides your internet connection. It is usually in the 192.168.x.x range.

Step 2: Connect to your router administration interface to find the DHCP range
By default, LAN clients are usually set to obtain their IPs automatically. What that means is, the router acts as a DHCP server, and serves IP addresses dynamically, as needed to the client computers. You need to find the range of IPs used for DHCP so you can later set your access point to use an IP address outside that range (but on the same subnet).
Login to your gateway's admin interface, usually by typing its IP address in your web browser, and find the DHCP range:

In this example, the DHCP range is from 192.168.1.10 to 192.168.1.100

Step 3: Connect a computer to the wireless router/AP
You need to  connect a computer (via a LAN port) to the new wireless router to be used as an access point. I'll refer to it as the "Acces point" from now on. To do this:
- set your client computer to obtain its IP automatically (default behavior in Windows)
- connect it to a LAN port on the access point using a Cat5 network cable
- reboot, or use the "ipconfig /renew" command in Command prompt to force it to get an IP address from the access point
Log into the admin page of the access point (you can find it's IP address as you did in step 1 for your main router). It is usually done by simply typing the IP address of the router in your browser's address bar.

Step 4: Configure the wireless router / AP
Once logged into the admin interface of the wireless router, you need to do two things. First, you need to change its internal/LAN IP address to an unused address in the same range/subnet as all your other LAN devices. Second, you need to disable the DHCP server on your new AP, so there is only one DHCP server on the network. In my case, my main gateway/LAN router is set to 192.168.1.1, and it is serving dynamic IPs via DHCP in the range 192.168.1.10 - 192.168.1.100. I have to use any other address in the 192.168.1.x range for the access point:

In this figure, my new wireless router/access point is set to use 192.168.1.2 as its IP address, and I've disabled DHCP, so it will not interfere with the DHCP server from my gateway. It is important to have only one device acting as a DHCP server, and that the IP address of the access point is in the same range as the main router.

 
Step 5: Connect the AP to the LAN
It is time to connect the reconfigured wireless access point to the network. Use a LAN port on the new wireless router, and connect it with a Cat5 network cable to one of the LAN ports of the existing gateway. Make sure not to use the "Internet/WAN" port on the wireless access point!
Connect your client computer to another LAN port of the gateway/router (if you do not reboot, you will have to use "ipconfig /renew" in command prompt to obtain an IP address from your router).
Note: Some older devices that do not support Auto-crossover (MDI/MDI-X) may require a crossover network cable (where the send and receive pairs are switched) between the two routers. This is not common with modern hardware.

Step 6: Test admin page is reachable and secure the AP
Now that the new wireless access point is connected to our network, with a correct IP address in the same range (and outside the DHCP range), we can test whether it's reachable, and secure the wireless connection.
In the above example, I configured the wireless AP to use 192.168.1.2. Its administration interface should be reachable by typing this IP address in the browser.
Once connected, it is time to set the wireless security:

Use WPA2 if both your access point and clients support it. Set a strong key, and remember it - clients will need this to be able to connect to the wireless network.  Try not to use WEP encryption - it can be cracked easily as illustrated here.

  Step 7: Test the AP wireless connection
Start a wireless client and make sure it properly connects to the network. It should pull an IP address automatically from your existing router/gateway (the DHCP server).
Done, you now have a wireless access point.

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