The LMHOSTS file is the local, static equivalent and predecessor of WINS. It is a text file that contains IP address to NetBIOS name mappings. It originated on Lan Manager (Microsoft's operating system before Windows) but used to be commonly configured on Windows OS clients and servers as well.
They are located in the \WINDOWS\system32\drivers\etc folder. If you actually plan to use the LMHOSTS file you will have to remove the .sam extension. The LMHOSTS.SAM file contains several sample mapping and an explanation.
I described both HOSTS, DNS, LMHOSTS, and WINS in my TechNotes here:
Here's an important part that should help you remember it:
The "LM" in LMHOSTS is short for LAN Manager, Microsoft's network operating system before Windows. WINS and NETBIOS are typical Microsoft technologies. So when you hear/read LMHOSTS think Microsoft, WINS, NETBIOS. More specifically IP address to NetBIOS name mappings. See for more details the TechNotes.
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