GRE and L2TP are 2 commonly referred Tunnelling protocols and may be confused at times. While GRE is abbreviation for Generic Routing Encapsulation, L2TP stands for Layer 2 Tunnelling Protocol. Neither of these protocols encrypt traffic to provide protection for the data being tunnelled. Furthermore, If we want to protect the traffic, then IPsec needs to be run over L2TP or GRE.  While GRE ip tunnel is used to carry “other” type of traffic, L2TP is used for multiplexing of multiple PPP sessions between two IP endpoints. L2TP was derived from Microsoft’s Point-to-Point Tunneling Protocol (PPTP) and Cisco’s Layer 2 Forwarding (L2F) technology

Below table details on differences between GRE and L2TP –

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