Quote Originally Posted by d000hg
It's not broadband - it's a dialup modem. And anyway using a router is just another expensive piece of hardware. It should be entirely possible to share the connection across a simple network.

Is it because I am using fixed IP addresses for the 2 PCs instead of DHCP? In that case why do my two PCS only see each other with fixed IPs and each having a gateway to the other?
http://www.practicallynetworked.com/sharing/sharing.htm

Follow the method and you should come out with two PCs networked and internet connection sharing installed.

TCP/IP Settings for the (LAN) NIC in the Sharing Computer

Enter the following information into your TCP/IP Control panel for the NIC in your Sharing computer:

*

IP address: set to 192.168.0.1
*

Subnet Mask: 255.255.255.0
*

WINS Configuration: Disable WINS resolution
*

Gateway: Make sure there are NO entries.
*

DNS Configuration: Leave this alone
DNS settings apply to all NICs in a given computer, so you can't set them differently for the LAN NIC.
If your ISP has assigned you a static IP address, this will probably be enabled and other information will be filled in when the first NIC was set up.
If your ISP uses DHCP to assign you an IP address, then this will probably be disabled because the DHCP server takes care of giving your computer the DNS and Gateway server information it needs.
At any rate, don't change the DNS setting.

*

Bindings: Check Client for Microsoft Networks and File and Printer Sharing for Microsoft Networks if you don't have any other protocol (NetBeui, IPX/SPX) installed and bound to these items. Otherwise uncheck both these items so that you do not have either item bound to TCP/IP.
*

Advanced: make sure the "Set this protocol to be the default protocol." is checked.
* NetBios: no changes.


TCP/IP Settings for the NIC in the Client Computer

You may need to change the following settings once you install Sharing, but they'll get you started so that you can test your network:

*

IP address: set to 192.168.0.2 through 192.168.0.254.
Each computer needs to have a different IP address.
*

Subnet Mask: 255.255.255.0
*

WINS Configuration: Disable WINS resolution
*

Gateway: set to 192.168.0.1
*

DNS Configuration: set to Disabled

*

Bindings: Check Client for Microsoft Networks and File and Printer Sharing for Microsoft Networks if you don't have any other protocol (NetBeui, IPX/SPX) installed and bound to these items. Otherwise uncheck them.
*

Advanced: make sure the "Set this protocol to be the default protocol." is checked.
* NetBios: no changes.

That should be it for TCP/IP installation