Network Segmentation: What It Is & How It Works

Navigating through a busy airport terminal is not too different from network segmentation. Passing through an airport involves clearing multiple security checkpoints, all while finding your way amongst what often feels like endless gates before finally arriving at your destination.

The many access controls limit unauthorized access beyond each point. And the logical organization into segmented zones—ticketing, concourses, gates—creates structure so passengers can intuitively navigate despite the chaos. Network segmentation works in a similar fashion, dividing networks into compartmentalized zones to improve security, monitoring, and access controls.

So what exactly is network segmentation and why has this network security technique become so essential?

Read on as we explore the concepts of physical and logical segmentation, implementation best practices, real-world use cases, and critical considerations for using network segmentation to its full potential.

What is network segmentation?

Network segmentation is the process of dividing a larger computer network into multiple smaller subnetworks or “segments.” This segmentation creates discrete zones that separate different users, devices, applications or traffic flows.

Segmentation can happen physically or logically.

Physical network segmentation  

Physical segmentation involves using actual network hardware like routers, switches and firewalls to physically divide a network into distinct infrastructure components. For example, an organization might dedicate specific routers and switches for an engineering subnet, accounting subnet, guest Wi-Fi subnet and so on. 

This approach directly separates network traffic flows by underlying hardware. However, physical segmentation requires purchasing and configuring expensive new equipment for each zone. It also lacks flexibility if organizational needs change.

Logical network segmentation

Logical segmentation utilizes virtual networking techniques to divide networks instead of hardware. Two common examples are VLANs and Layer 3 IP addressing schemes:

VLANs (virtual local area networks) configure switch ports into isolated traffic groups even on the same physical switch. A single switch can have multiple VLANs to segment connected devices into logical subnets.

Layer 3 network segmentation assigns devices IP addresses on different logical subnets. Inter-subnet traffic must pass through a router which enforces separation by only routing traffic to the correct destination subnet.

Logical segmentation does not require new equipment since it takes advantage of existing infrastructure. It is flexible, cost-effective and easy to reconfigure as an organization evolves.

Network segmentation vs microsegmentation

Network segmentation and microsegmentation are similar in that they both enhance network security, but they differ in how detailed their approach is.

Network segmentation

As discussed previously, network segmentation separates a network into large logical or physical subnetworks at a high level. For example, network segmentation could divide different business units, functions or traffic types into separate security zones.

These network segments have their own routers, switches, firewalls and security controls. However the segments themselves can still be fairly large environments that include many users, devices and applications all grouped into a single trust domain. 

Microsegmentation

Microsegmentation takes the network division process down to a much more granular level—segmenting a network into very small, individual workloads rather than larger groupings. 

Where network segmentation might secure an entire department or application tier, microsegmentation would lock down each component individually such as a single virtual machine, container, server, device or pod.

This enables very targeted security policies tuned to specific workloads including precise network firewall rules, role-based access controls, and application-layer protections. However, managing security at this scale is exponentially more complex.

How network segmentation works

Network segmentation works by controlling the flow of traffic between the segmented zones or subnets. To enable this, you first need to divide your network into logical segments based on organizational criteria.

For example, you may create separate segments for departments, geographic locations, applications, data types, or compliance regimes. Each segment functions as its own security domain with boundaries to other zones.

Once you have defined network segments, you can implement controls determining how traffic can move between them.

Complete blocking

The most restrictive policy completely blocks any connectivity between certain segments. For example, you may want to completely isolate payment card data to comply with PCI regulations. This would cut off lateral pathways for threats to spread as well.

Selective filtering

Instead of completely cutting connectivity, you can use selective filtering to limit what kind of traffic can flow between zones. For example, you may allow DNS and NTP but block other traffic types. Or restrict based on source IP, destination port, app fingerprints, and more.

Application-layer inspection

Modern environments require granular application-level controls instead of relying only on IP addresses and ports. Segmentation can integrate next-gen firewalls to inspect flows and explicitly allow or deny access requests based on user identity, device posture, and other contextual signals.The criteria and mechanisms may differ, but segmentation always works by enabling and securing lateral communications between isolated zones rather than just erecting perimeter boundaries. This zero-trust approach provides layered internal defenses to limit an attacker’s progression.

Why is network segmentation important?

Securing your digital assets is a top priority and while firewalls are very strict and capable of following established firewall rules, they do not achieve everything you need to keep your digital assets protected. They can also become outdated and only offer frontline defense.

As digital innovation delivers new services and network environments, risks increase. Attacks can occur beyond the traditional network boundaries. Although your security may be breached via something such as your smart lighting system, once the threat gains access to a flat network, it can gain access to confidential information. Network segmentation, however, reduces the risk of access to other data.

Who needs network segmentation?

Any organization that runs internal systems needs network segmentation whether it be physical network segmentation or logical network segmentation.

As networks grow in complexity, the need for segmentation becomes increasingly important. Although flat networks may take less time to implement, it is important to remember that flat networks allow threats to move laterally across the entire network with few obstacles and cannot provide the same benefits as network segmentation.

Enterprise segmentation

Implementing segmentation on enterprise networks involves greater intricacy and constant maintenance. Various parts of an enterprise network are separated to achieve multiple benefits. By splitting these networks using logical segmentation, enterprises stand to gain improved security, better access control, improved network management, and a boost in performance.

Rather than relying on labor-intensive manual mapping processes, enterprises can opt for better solutions such as automated network infrastructure mapping tools and cloud-based network monitoring.

The benefits of network segmentation

Now that we know how and why you might decide to segment a network, let’s go over the benefits gained from network segmentation.

You might segment a network to achieve one or all of these things:

• Improve network visibility and monitoring
• Increase network security
• Control physical access to specific network equipment
• Reduce the blast radius during an outage or attack
• Increase network performance

Improve visibility and monitoring

Network segmentation improves network visibility by allowing you to introduce more points in the network where traffic can be inspected, counted, and monitored. For example, ensuring east-west traffic flows through a core router allows you to monitor traffic flowing between subnets.

Increase security

By ensuring different groups of devices pass through a firewall, you can apply access control lists to the traffic and enable the concept of least privilege. It also allows the traffic to be inspected by security tools such as the network traffic analysis tool that can evaluate for potential threats.

Reduce the blast radius during an outage or attack

In a world where nothing ever went wrong, there’d be no need to contain a blast. But the reality is that broadcast storms, bandwidth hogs, and other network issues can affect an entire network—unless they’re limited to a local subnet. And when things do go wrong, segmentation significantly reduces your mean time to resolution by narrowing the focus area of your network troubleshooting.

Increase performance

Smaller subnets mean fewer hosts on each subnet. Fewer hosts mean you can build and enforce more granular Quality of Service policies. Fewer hosts also mean less traffic and a smaller broadcast domain. Reducing the broadcast domain reduces ‘noise.’ All in all, network segmentation contributes to better performance across the board.

Network segmentation examples

There are many practical scenarios where businesses implement network segmentation to improve security and operational efficiency:

Securing guest Wi-Fi access

Allowing guests to access your corporate Wi-Fi network can be risky since their devices are unknown and untrusted. However, you still want to provide internet connectivity as a convenience. The solution is to segment guest access by creating an entirely separate guest Wi-Fi network using a distinct SSID. 

When a visitor connects to your guest Wi-Fi, they will have internet access but remain isolated from any internal company resources or data. Enabling wireless isolation for the guest SSID contains all their traffic within an isolated virtual segment to minimize the attack surface. 

This allows you to extend Wi-Fi access to visitors securely by compartmentalizing it into its own network segment with restricted permissions and traffic containment. 

Creating a voice network

Unlike data networks, voice traffic over IP is extremely sensitive to jitter and latency issues. Even small delays can degrade call quality and clarity for your users. Mixing voice and data on the same network often introduces problems.

By segmenting voice users into a dedicated VLAN, you can optimize the infrastructure specifically for reliable voice delivery rather than mixed traffic. Quality of Service (QoS) policies applied to the voice VLAN will help prioritize voice packets, avoiding choppy calls. This dedicated environment also streamlines monitoring and troubleshooting voice performance issues since the network is purpose-built for it rather than shared.

Internal application isolation

You may find that different business applications within your organization have very different security needs. A payroll system contains extremely sensitive data like employee salaries and bank details. An e-commerce website holds customer data that still requires protection but is likely less confidential.

Rather than taking a one-size-fits-all approach, you can customize security for each application by placing them in separate network segments based on their level of risk. For example, you could isolate the payroll systems while putting e-commerce applications in another zone.

This segmentation allows tailoring security controls, auditing requirements, and backup protocols specific to each application’s sensitivity profile. Your payroll zone would have stricter access policies, more frequent audits, and tighter backups than the lower-risk e-commerce segment. Of course, you still protect the e-commerce zone but can relax restrictions compared to the payroll systems.

Secure privileged access

If you have highly privileged accounts like domain administrators, take extra steps to limit exposure. These users often have widespread access to an organization’s most sensitive systems and data. Segmenting privileged access holders into confined network zones restricts damage if their credentials ever become compromised.

For example, you could isolate your domain controllers and admin workstations into a separate management subnet with additional monitoring and controls. This approach also lets you easily log and audit admin activity to detect suspicious or unauthorized actions.

Mergers and acquisitions

When companies merge or acquire other organizations, directly connecting their networks together poses huge security risks. You may be inheriting vulnerabilities or compromised devices without even knowing it.

Using network segmentation, you can maintain separation between the networks during integration. This allows you to gradually unite them together at a careful pace rather than all at once. Before allowing any connectivity between your segments, you can comprehensively validate the security posture of the newly integrated parts of your infrastructure.

Only after thorough penetration testing, policy reviews and risk assessment should you start selectively enabling controlled traffic between your existing network zones and the newly added segments.

Network segmentation best practices

Implementing effective network segmentation requires thoughtful planning and diligent upkeep. Without proper care, your segmented architecture can become porous or degrade into disarray.

Follow these eight best practices to keep your network segmentation deployments on track.

1. Validate and assess regularly

Continuously verify that your network segmentation aligns with intended designs. Schedule frequent external penetration tests to probe for potential gaps, as well as internal red team exercises to try unauthorized lateral movements. This helps quantify your risk exposure and highlights zone vulnerabilities. 

Make risk assessments a regular habit—rank priorities and tackle issues before they become headaches. Anytime changes roll out, follow up with retesting. It’s easy to become complacent once things seem stable, so avoid that temptation by making ongoing assessments standard protocol. 

2. Monitor user activity and traffic

Closely track user access and inter-subnet traffic to catch any unusual activity. Watch for anomalies that could suggest compromised credentials or an insider threat at play. Make sure to log all user sign-ins and traffic flows between network zones, then aggregate the data in a central SIEM platform. This allows you to properly correlate and analyze the authentication trails.

Baseline typical traffic patterns so you can trigger alerts when deviations occur. Additionally, periodically review audit logs to check that your network segmentation and access rules match intended least-privilege restrictions. 

3. Automate repetitive tasks

Managing a complex segmentation architecture involves lots of repetitive manual processes—approving access requests, reviewing firewall rules, and changing configurations. As environments scale up, keeping up with these mundane tasks gets tougher.

You can maintain consistency and save your team bandwidth by automating these repetitive duties. Set up orchestration playbooks to handle common workflows like adding new devices or users to zones. Integrate machine learning to automatically adapt configurations as new vulnerabilities emerge.

The more you can hand off through automation, the more your team can focus on big-picture oversight versus daily upkeep drudgery. It also ensures important tasks don’t fall through the cracks as breakneck business growth adds complexity faster than humans can adapt.

4. Integrate with your existing controls

As you implement network segmentation, be sure to integrate with other security systems you already have in place. For example, you’ll want to coordinate your segmentation plans with your identity and access management system. Sync up user attributes and access contexts between the systems so you have consistent policies.

You should also make sure your next-generation firewall policies align with zero-trust principles across your segmented architecture. Tune firewall rules to restrict lateral movement between zones. And provide your network detection tools full visibility into all segmentation layers so they can monitor traffic across subnet boundaries.

Taking this integrated approach eliminates the risk of conflicting rules or policies across platforms that could create security gaps. The key is making sure all of your access controls and visibility tools tie together holistically to support your segmentation model.

5. Adopt a zero-trust mindset

You should embrace zero-trust principles in your network architecture. This means denying access by default across all segments and requiring verification for all requests. Tie access decisions to dynamic contextual signals – like user identity, device security posture, location, and behavioral analytics. Log all connection events to stay vigilant.

A zero-trust approach secures intra-segment traffic flows rather than only fortifying north-south perimeters. Encrypt communications between servers in the finance zone, for example, to limit exposure. Micro-segmentation and lateral inspection prevent threats from hopping between workloads once inside a zone. The goal is to rigorously isolate sensitive assets, and then monitor them closely.

6. Start small and scale up gradually

Avoid biting off more than you can chew early in your segmentation journey. It’s better to start small but be intentional about eventually scaling up. Focus first on tightly locking down your most critical data and apps – the “crown jewels” of your business. Set up a narrow, controlled zone with limited functionality to secure them.

Then, steadily work outward in deliberate phases to cover more ground. The key is not boiling the ocean and tackling everything at once. Take things step-by-step, and steadily expand the segmentation as needed.

Make sure your initial architecture has room to grow as your business scales exponentially. Build flexibility into your network segmentation plans, allowing complexity to increase gradually without letting it get disorganized. Move cautiously but think long-term when considering the bigger picture.

7. Strike the right balance with segmentation

You’ll need to find the sweet spot for how many network segments to create. Too few segments leaves major avenues for attackers to freely roam your network after getting an initial foothold. But go overboard with too many microsegments and you’ll face management headaches as access rules and controls multiply exponentially. This quickly gets unwieldy.

Over-segmentation also risks frustrating your users as they constantly need to hop between an endless maze of disconnected subnets just to do their jobs. This leads to complaints impacting productivity.

The key is judiciously evaluating organizational needs, risk tolerance levels, and network traffic patterns. Let these core business guides determine optimal segmentation density, not arbitrarily chasing maximum segments. The right balance fortifies defenses without driving everyone crazy or blowing up IT workloads. Continually assess as needs evolve over time.

8. Visualize your network architecture

Creating a detailed diagram of your network segmentation is hugely beneficial. Centrally map both your intended logical designs and the current physical layout. Regularly scan configurations and connected assets to fix inaccuracies causing map drift.

Visualizations allow you to clearly see authorized traffic flows between zones and access patterns for different user roles. You can identify choke points where excessive inter-zone communications happen, signaling potential areas to re-architect.

Continuously keeping your network topology documentation updated is essential as segmentation schemes scale and evolve. Network diagrams provide crucial blueprints allowing teams to coordinate changes, troubleshoot issues, and validate that implementations align with the overall strategy.

Secure your organization’s digital environment with network segmentation

Network segmentation is an essential technique for securing modern digital environments against escalating cyber threats. By compartmentalizing networks into isolated yet interconnected subnetworks, organizations can better control access, improve monitoring, speed threat response, and limit blast radius. 

Both logical segmentation utilizing software-defined controls and physical segmentation leveraging discrete network hardware have benefits depending on use case needs. To maximize ROI, it’s vital to incorporate network segmentation as a central pillar when architecting zero-trust environments. 

Adhering to best practices around continuous validation, granular user/traffic visibility, automation, and gradual scaling enables realizing the full security and efficiency dividends. 

As networks become more fluid and complex, intelligently designed segmentation architectures will prove critical for balancing connectivity and control across distributed assets and users. Moving forward, integrating network segmentation broadly across IT infrastructure and security stacks is fundamental to creating resilient foundations for digital innovation.