Auto-MDIX
To connect two ports of the same configuration (MDI to MDI or MDIX to MDIX), an ethernet crossover cable is needed to cross over the transmit and receive signals in the cable, so that they are matched at the connector level. The confusion of needing two different kinds of cables for anything but hierarchical star network topologies prompted a more automatic solution.
Auto-MDIX automatically detects the required cable connection type and configures the connection appropriately, removing the need for crossover cables to interconnect switches or connecting PCs peer-to-peer. As long as it is enabled on either end of a link, either type of cable can be used. For auto-MDIX to operate correctly, the data rate on the interface and duplex setting must be set to "auto". Auto-MDIX was developed by Hewlett-Packard engineers Daniel Joseph Dove and Bruce W. Melvin. A pseudo-random number generator decides whether or not a network port will attach its transmitter, or its receiver to each of the twisted pairs used to auto-negotiate the link.
When two auto-MDIX ports are connected together, which is normal for modern products, the algorithm resolution time is typically < 500 ms. However, a ~1.4 second asynchronous timer is used to resolve the extremely rare case (with a probability of less than 1 in 1021) of a loop where each end keeps switching.
Subsequently, Dove promoted auto-MDIX within the 1000BASE-T standard and also developed patented algorithms for "forced mode auto-MDIX" which allow a link to be automatically established even if the port does not auto-negotiate. This may or may not be implemented on a given device, so occasionally a crossover cable may still be necessary when connecting auto-MDIX to MDIX (hub or switch), especially when autonegotiation is deactivated. Newer routers, hubs and switches (including some 10/100, and all 1 Gigabit or 10 Gigabit devices in practice) use auto-MDIX to automatically switch to the proper configuration once a cable is connected. The other four wires are used but are not crossed since auto-MDIX is mandatory at the higher data rates (1000BASE-T transmits and receives on all pairs simultaneously without any dedicated send/transmit pairs).
Read more about this topic: Medium Dependent Interface