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I have two routers and the tunnel between them is up and working well. Router1 has GRE/IP as the protocol on its tunnel interface, and as for Router2 the tunnel interface is working with IPSEC/IP. Can someone throw a theoretical insight as to how this is possible. My limited knowledge of the subject tells me that both ends need to have the same protocols configured.

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    Both ends of the tunnel must negotiate things like IPsec. You cannot do what you suggest. How does an end with GRE decode IPsec, or vice versa? – Ron Maupin Feb 13 at 19:09
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    Your limited knowledge is correct. If I speak Basque and you speak Tagalog, we won't communicate very well. – Ron Trunk Feb 13 at 19:09
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No. A tunnel requires both endpoints to be able to decapsulate the traffic from the other endpoint, and one endpoint configured with one type of encapsulation will not know how to do that for a different encapsulation.

You could have two separate tunnels with different encapsulations, or you could have one tunnel inside another tunnel, e.g. GRE inside IPsec.

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