What is Network Segmentation?
Network segmentation is the digital architectural technique of dividing an organization’s network into smaller, isolated segments or subnetworks, each with its own set of access controls and security measures. Network segmentation has multiple applications for IT and security departments, including to enhance monitoring, to enhance network performance, to localize and solve specific technical issues, to satisfy compliance requirements, and to ultimately increase network security.
From a cybersecurity standpoint, network segmentation can help limit the attack surface and limit lateral movement if a threat actor gains initial access into the network.
By distributing valuable assets, applications, and access across network segments, an organization is effectively using isolation to minimize the opportunity for potential access by threat actors; while making it more difficult for an attacker, should one gain access, to jump from one network segment to another.
What Are the Types of Network Segmentation?
Network segmentation falls into five main categories:
- Physical Segmentation: Using separate physical networks for different segments
- Logical Segmentation: Using virtual local area networks (VLANs) or other logical separation techniques at the network level (Layer two and three of the OSI model)
- Macro-Segmentation: Segmenting through large boundaries, like firewalls or gateways, such as to separate guest Wi-Fi from a corporate LAN.
- Micro-segmentation: Dividing a network into small segments via software (Layer 7) at the workload or application level, often to control “east-west” (intra-data center) traffic
- Identity-Based Segmentation: Governing access based on user or device identity, not just IP or location.
It should be noted that, in addition to being a security best practice, network segmentation is a key component of a zero trust strategy. Without segmentation, an organization may struggle to enforce fine-grained access controls, limit unauthorized lateral movement across the network, or continuously verify connections inside the network, all of which are needed for a zero trust strategy to be successful.
How Does Network Segmentation Work?
At its core, segmentation works by applying rules and enforcing controls on how traffic flows between different network zones. This typically involves creating sub–networks, or VLANs for different types of devices, users or applications. Each segment is then isolated from others by firewalls, access controls, or other security measures.
Examples of business drivers for network segmentation include:
- Separation By Function: HR systems, finance databases, and guest Wi-Fi traffic each often sit on their own segment as a security best practice
- Traffic Control: Business rules should dictate who (or what) can talk to whom, and under what conditions; access control lists (ACLs), firewalls, and micro-segmentation policies can be used to govern this
- Movement Monitoring: When the need arises, it should be possible to contain suspicious or unauthorized lateral movement (like malware trying to spread from one system to another) within a single segment
The best way to think of network segmentation is a house where every room inside the house is locked and needs a unique key to open it. If a threat actor is able to get a key to the front door, they still won’t be able to enter any of the rooms, and what is in those rooms will remain protected.
However, network segmentation needs another component to deliver enhanced security: real-time monitoring. This requires collecting and analyzing data from network logs, flows, packets, or hosts; many organizations employ all of those approaches. Using the above analogy, if security teams have visibility into and can monitor all segments of the network, they may help security teams detect attempts entering the house and jiggling the handles on the locked doors. This can greatly reduce network risk.
Real-World Network Segmentation: Hospitals
Hospital or medical facility networks highlight the importance of network segmentation in action. These facilities contain a wide range of devices, systems, and data (e.g. internet-enabled medical devices, IoT devices, Wi-Fi networks, administrative applications, patient records), and if one of those components of the network is compromised, it could create a massive, organization-wide incident without proper network segmentation.
By segmenting the network, the organization can break apart its network into distinct subsegments for device types or business purposes, such as medical devices, staff endpoints, or guest and employee Wi-Fi networks, and then monitor all those segments individually. This reduces the attack surface and limits the impact of a potential breach.
Explore how hospitals and other industries are targeted by threat actors with the Arctic Wolf 2025 Threat Report.
Security Benefits of Network Segmentation
As mentioned above, network segmentation is often viewed as a key security control due to its ability to prevent and limit the impact of intrusions, as well as how it enforces the principle of least privilege (PoLP), a key identity and access management (IAM) tenant and part of a comprehensive zero trust strategy.
Benefits of network segmentation for security include:
- Attack Surface Reduction: Network segmentation limits unnecessary connections and unfettered network access opportunities for threat actors. With this technique deployed, compromised devices won’t be able to serve as a foothold for access to the network at large, preventing lateral movement or attack escalation.
- Breach Containment: If a breach occurs somewhere on the network, network segmentation helps security teams contain the boundaries of that breach before it escalates, making it far less likely to spread to the larger network.
- Access Control and Access Policy Enforcement: Network segmentation through firewalls, VLANs, identity controls, and other methods serve as key access control points for enforcement of access management policies.
- Enhanced Visibility and Monitoring: By segmenting the network, security teams (with the help of monitoring solutions) can see abnormal behavior, traffic patterns, and other activities with more granularity, because more-specific business and policy rules should make it easier to identify malicious or anomalous activity. Additionally, intrusion detection systems (such as detection and response solutions) often operate more effectively when network perimeters are clearly defined through segmentation.
- Regulatory Compliance: Many compliance frameworks (e.g. PCI DSS) may require network segmentation to keep sensitive data within networks protected.
Learn more about network security with “Why You Need Continuous Network Monitoring.”
Explore how identities and access are targeted by threat actors and how network segmentation, among other actions, can reduce risk.
