A data relay apparatus is connected to a network having a DHCP server and an authentication server. The data relay apparatus stores a MAC address of a communication device permitted to connect to it. When a communication device attempts to connect to the data relay apparatus, it is determined whether a MAC address of the communication device is stored in the data relay apparatus. If the MAC address is stored, the communication device is not authenticated by the authentication server, instead, dummy data indicating that authentication is successful is transmitted to the communication device. If the communication device requests that the DHCP server assign it an IP address, the DHCP server assigns an IP address to the communication device. Different security levels are set for a communication device that has failed to authenticate to the authentication server and for a communication device that successfully authenticates to the authentication server.