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Use iSCSI storage for VMware to create a data store
Administrators can create a data store in vSphere with iSCSI storage. It's a relatively cheap, fully supported option, but it doesn't perform as well as direct-attached storage.
VMware enables the use of storage technology that is cheaper and less complex than direct-attached storage or storage area networks. Use iSCSI storage for VMware to create a data store in the vSphere desktop client.
It's relatively easy to create a data store on iSCSI-attached storage in VMware vSphere. Using iSCSI does not offer the same level of performance as direct-attached storage or storage area networks, but iSCSI storage for VMware can offer a less expensive option that VMware fully supports.
The exact method of creating a data store on iSCSI storage for VMware vSphere varies depending on the management interface you use. This example uses the vSphere desktop client, but the configuration process works similarly in the web client. The client is now HTML-5 based, but you can follow this process if you haven't yet upgraded, or modify it if you have.
How to create a data store on iSCSI storage in VMware vSphere
Before you enable iSCSI connectivity, you must create a VMkernel network adapter. This adapter should be bound to a physical network interface card within your vSphere host.
Create the required VMkernel adapter by navigating to the Configuration tab. Next, select the Networking option, click Add Network Wizard and choose the option to create a VMkernel adapter.

With the VMkernel adapter in place, you can start creating the iSCSI Software Adapter. Go to the Configuration tab and choose the Storage Adapters option. Click Add and choose the option to create the iSCSI Software Adapter. Figure B shows what the adapter should look like.

The next step is to link the iSCSI Software Adapter to the VMkernel adapter you created previously. Right-click on the iSCSI Software Adapter and choose the Properties option from the shortcut menu. This will open the iSCSI Initiator Properties window.
Select the properties sheet's Network Configuration tab and click Add. When prompted, select your VMkernel adapter -- be sure to choose the correct one -- and click OK. The Network Configuration tab should now list the VMkernel adapter, and the Port Group Policy should reflect a status of Compliant.

Make sure that your iSCSI Initiator is enabled. To do so, go to the properties sheet's General tab and check that the Status is set to Enabled. If the Initiator isn't enabled, then click on the Configure option and select the Enabled checkbox.

Connect the iSCSI initiator to one or more iSCSI target by way of a discovery process. VSphere enables you to discover iSCSI targets either dynamically or manually. If you want to establish a static connection to an iSCSI target, click on the Static Discovery tab, and then click the Add button.
After doing so, the system will prompt you to provide the name or address of the iSCSI server, the port number -- which is usually 3260 -- and the iSCSI target name. Depending on the configuration of your iSCSI targets, it might prompt you to provide authentication credentials.
Dynamic Discovery is slightly simpler to configure. All you have to do is go to the Dynamic Discovery tab, click Add, and then specify the name or address of the iSCSI server, as well as the port number. The iSCSI Initiator will query the specified server and present you with a list of targets to which you can connect. Once again, authentication may be necessary depending on how the setup of the iSCSI server.
Once you attach iSCSI storage for VMware vSphere, the last step is to create a data store. From the Configuration tab, choose the Storage option, and then click the Add Storage link. When you see the Add Storage dialog box appear, choose Disk/LUN.
As you can see in Figure E, this is the option that will enable you to create a data store on iSCSI storage. Follow the ensuing prompts to select your iSCSI storage and to create a Virtual Machine File System data store.

Connecting your hosts to iSCSI storage for VMware vSphere is a relatively simple process. In most cases, you'll probably get better performance from direct-attached storage or a Fibre Channel storage area network, but VMware fully supports placing data stores on iSCSI-attached storage.