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DCE equipment is typically a modem or other type of communication device. The DCE sits between the DTE (data terminal equipment) and a transmission circuit such as a phone line. Originally, the DTE was a dumb terminal or printer, but today it is a computer, or a bridge or router that interconnects local area networks. In an IBM mainframe environment, a communication controller and a link-attached cluster controller are examples of DTEs.

A DCE provides a connection for the DTE into a communication network and back again. In addition, it terminates and provides clocking for a circuit. When analog telephone lines are the communication media, the DCE is a modem. When the lines are digital, the DCE is a CSU/DSU (channel service unit/data service unit).

DTE and DCE interfaces are defined by the physical layer in the OSI (Open Systems Interconnection) model. The most common standards for DTE/DCE devices are EIA (Electronic Industries Association) RS-232-C and RS-232-D. Outside the United States, these standards are the same as the V.24 standard of the CCITT (Consultative Committee for International Telegraphy and Telephony). Other DTE/DCE standards include the EIA RS-366-A, as well as the CCITT X.20, X.21, and V.35 standards. The later standards are used for high-speed communication over telephone lines.

DTE and DCE devices send and receive data on separate wires that terminate at a 25-pin connector. It is useful to know that DTE devices transmit on pin connector 2 and receive on pin 3. DCE devices are just the opposite-pin 3 transmits and pin 2 receives.

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