Windows Vista introduced this feature and Windows 7 takes it forward by letting you host an ad-hoc Wi-Fi network in a couple of steps without any difficulty and having to deal with advanced settings.
Before we begin, you should make sure that your wireless card isn’t currently connected and even if your laptop is connected to the wired network, your wireless card should be free, so that you can use it to allow access to the internet by bridging it to the LAN or through internet connection sharing.
To set up, follow these steps:
• Go to Network and Sharing Center present in the Control Panel (You can quickly access it by right-clicking on the network icon in the system tray and clicking on ‘Open Network and Sharing Center’.
• Next Click on ‘Set up a new connection or network’ in the right pane. You'll be prompted with a wizard that allows you to connect to VPNs, dialup, or create a new ad hoc wireless network, which is what you are here to do. You can use this ad hoc network to share files back and forth between two computers, and share the internet connection.
• Select ‘Set up a wireless ad-hoc (computer to computer) network’ and click on next twice.
• Here you can enter your network name and chose security options for your Network. WEP is extremely easy to crack and some Linux distributions like BackTrack even come with an in built utility to crack WEP encryption. So we recommend you to use WPA2 encryption with a good key. If you want this ad-hoc connection to become permanent, check the ‘Save this Network’ box. However, if you are just creating this network for one instance and don’t plan to use it again, leave it unchecked.
• Now your ad hoc network should be up and running and ready to start connecting your devices.
• Click on ‘Turn on Internet Connection Sharing’ if you want to provide internet access to other devices that you intend to connect using this network. You'll notice that the ad hoc networks that you create get added to the View Available Networks list. When you disconnect from your ad hoc network, it's the same as stopping it. Connecting to the network is the same as setting and starting it back up; this way you can quickly switch back and forth between connection.
If you are connected to the internet using Local Area Network, then remember to enable Internet connection sharing for your LAN adapter also by going to Network and Sharing Center and clickin on ‘Change adapter settings’ in the left pane. Then right click on whatever adapter is connected to the internet and enable internet connection sharing for it.