Layer 3 Switch vs Router: What Is the Difference?

A Layer 3 switch is an Ethernet switch that can also route IP traffic between VLANs and subnets, while a router is a device built to connect separate networks, above all a site to the outside world. Both work at Layer 3 of the OSI model, reading IP addresses to decide where a packet goes. Where they differ is how they route, how fast, and what else they do.

A Layer 3 switch routes in its switching hardware, using the same application-specific chips (ASICs) that switch Ethernet frames. That lets it move traffic between VLANs at close to wire speed on every port. A router routes mainly in software or network processors, so its raw throughput is lower, but it handles far more protocols and services: WAN links, network address translation, firewalling, VPNs and internet routing.

In short, use a Layer 3 switch for fast routing between segments inside a site, and a router at the boundary to everything beyond it. Many networks use both.

A plain Layer 2 switch forwards frames by MAC address within one network. Once a site is split into VLANs, say one for cameras, one for controllers and one for office PCs, something has to route between them. A Layer 3 switch does this internally: each VLAN gets a virtual interface with its own IP address, and the switch routes between those interfaces in hardware. It typically supports static routes and, on larger models, dynamic routing such as RIP or OSPF, plus access control lists to filter what may cross between VLANs. Our explainer on VLANs covers how the segments are set up, and our guide to Layer 2 vs Layer 3 switches explains when a site needs Layer 3 at all.

A router’s job is the edge of the network. Our guide to what a router does covers this in full; the features that matter when comparing it with a Layer 3 switch are below.

Start from where the traffic goes, not from the device names.

A common design puts a Layer 3 switch at the core of a plant or vehicle network and a router or firewall at its edge. The switch handles busy local traffic, such as cameras streaming to a recorder on another VLAN, without that traffic ever touching the router. The router handles the slower link to the corporate network, the cloud or a cellular backhaul, and applies the security policy at that boundary.

Rugged systems often build this in at board level. Our Ethernet switch boards include Layer 3 managed models that sit inside a vehicle or enclosure, and our managed industrial switches include 16-port Layer 3 models with 10G SFP+ uplinks, some with PoE++ ports. At the edge, an industrial IoT gateway can take the router role, with cellular WAN, VPN and firewalling.

We supply Layer 2 and Layer 3 industrial switches and edge gateways, configured to the site’s VLAN and routing plan as standard. Send us your network layout, and we will specify where switching and routing should sit.