An encapsulation error occurs because the bits placed in a particular field
by the sender are not what the receiver expects to see.
This condition
occurs when the encapsulation at one end of a WAN link is different from the
encapsulation in use at the far end. If the protocol is one that expects to see
appropriately formatted keepalives or correctly structured negotiation frames,
such as PPP, then it is likely that the interface will enter the following
state:
Interface is up, line protocol is
down
However, if the Layer 2 protocol is a broadcast
medium such as Ethernet, then keepalives are not exchanged between DTE devices
and the interface will remain in the state:
Interface is
up, line protocol is up
This will be so, even if
incompatible Ethernet encapsulation types are being used. Fortunately, in an IP
environment it is rare to change the Ethernet encapsulation type to anything
other than the default ARPA. Ethernet encapsulation type mismatches are most
likely to occur in an IPX environment where the default Ethernet encapsulation
has changed over the years with different versions of Novell’s Netware server
operating system.
The following guidelines should be adopted when
troubleshooting Ethernet problems:
- In an IP environment, treat any Ethernet encapsulation other than ARPA as
suspicious.

- In an IPX environment, check the encapsulations in use on the servers as
this is a common misconfiguration on the router.