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Amazon Web Services (AWS) Transit Gateway VS VPC Peering

Last Updated : 05 Feb, 2024
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Are you looking forward to enhancing the connectivity of your Cloud Infrastructure using AWS? If it is so, you have landed in the right place. This article covers detailed AWS Transit Gateway and VPC Peering, their advantages, use cases, and differences. By the end of this article, you will be easily able to decide which AWS networking solution best suits your product requirements.

Cloud Services like AWS are a crucial part of organizations these days. However, the efficiency of these solutions depends on a robust networking infrastructure. So AWS offers solutions like Transit Gateway and VPC Peering so that we can make our Cloud infrastructure reliable and utilize cloud connectivity. This helps the applications and components to efficiently exchange information with each other.

In this article, we will explore AWS Transit Gateway and VPC Peering, emphasizing their distinctions, and enabling you to make an informed choice tailored to your networking needs.

What is AWS Transit Gateway?

AWS Transit Gateway is an AWS service that helps us to establish the connectivity between Amazon Virtual Private Clouds (VPCs), on-premises networks, and remote networks. It acts as a central hub that allows communication between connected networks. It works as a virtual router to connect the AWS Virtual Private Clouds and VPN connections. Transit Gateway is scalable, which means that it can accommodate a large number of requests easily. In other words, it simplifies the networking architecture and enables efficient traffic routing between different environments.

What is VPC Peering?

Before understanding the VPC Peering let us understand what VPC is. VPC (Virtual Private Cloud) is the virtual network that is allocated to your AWS account. It remains isolated from the other virtual networks. Also, we can launch the AWS resources in our VPC.

Now, when we connect two VPCs to route traffic between them, we can call it VPC Peering. Hence, VPC Peering is a networking connection between two Virtual Private Clouds (VPCs) in the same or different AWS regions. It enables direct communication between the peered VPCs as if they are part of the same network. Suppose you have multiple AWS accounts. In this case, you can connect the VPCs of the accounts and create a file-sharing network.

After getting a basic overview of the VPC Network, let us compare them so that we can choose what is suitable for our requirements.

AWS Transit Gateway vs VPC Peering: Key Differences


AWS Transit Gateway

VPC Peering

Network Scope

Centralized hub connecting multiple VPCs, on-premises networks, and remote networks

Direct connection between two VPCs

Hub-and-Spoke Model

Follows a hub-and-spoke model, simplifying network architecture and management

Creates a direct connection between two VPCs, forming a mesh network if needed

Transitive Routing

Supports transitive routing, enabling communication between VPCs even if not directly peered

Requires manual configuration for transitive routing between more than two VPCs

Cross-Region Connectivity

Enables cross-region connectivity, allowing VPCs in different regions to connect

Limited to VPCs within the same or different regions

Management Simplification

Simplifies network management, especially for organizations with multiple VPCs

Suitable for simpler scenarios with fewer VPCs

Integration with VPN and Direct Connect

Integrates seamlessly with VPN and AWS Direct Connect for hybrid cloud setups

Direct connection between VPCs without integration with VPN or Direct Connect

Advantages of AWS Transit Gateway

  • It simplifies the architecture: The architecture is such that Transit Gateway acts as a central hub for connecting multiple VPCs and external networks. This centralized model simplifies network architecture and management.
  • It allows us to implement the transitive routing: There are many cases in which the networks are not directly peered. In that case, we can implement transitive routing to communicate with different components over the network.
  • It supports the on-demand bandwidth: We can easily expand our network by extending the bandwidth. This helps us to share large amounts of data across the network. Hence, we can easily scale our Transit Gateway configuration.

Advantages of VPC Peering

  • It maintains the network isolation: VPC Peering maintains separate IP address space and security groups. Hence, one VPC does not affect another so, the communication process becomes controlled.
  • It allows us to create a mesh network: It allows the creation of a mesh network by establishing direct connections between multiple VPCs. This flexibility is useful for resource sharing and collaboration.
  • It promotes resource sharing: It helps in reliable resource sharing and collaboration between peered VPCs, fostering a scenario where resources can be used across connected VPCs.

When should I choose AWS Transit Gateway?

Following are points that tell us about the use cases of AWS Transit Gateway:

  • Transit Gateway is suitable if you need a scalable network architecture to connect multiple VPCs, on-premises networks, and remote networks in a hub-and-spoke model.
  • You should choose the Transit Gateway if You need cross-region connectivity. Thus, you can connect VPCs in different regions with Transit Gateway.
  • You should select Transit Gateway if your cloud infrastructure requires transitive routing. So, you can use it to enable the inter-VPC communication even when they are not directly peered.

When should I choose VPC Peering?

Now, let us see the scenarios in which the VPC Peering is appropriate as shown below:

  • VPC Peering is useful for setting up a simple network scenario with a limited number of VPCs. In such cases, the direct connections between pairs of VPCs are sufficient to route the traffic.
  • Also, you can use VPC Peering if your primary requirement is resource sharing and collaboration between specific VPCs without the need for a centralized hub.
  • You need to use VPC Peering if you face challenges in the complex hub-and-spoke model. Thus, it is useful for the cases in which we just need a straightforward and direct connectivity between two VPCs.

Cost of AWS Transit Gateway

Since it is part of the AWS Service, it follows the cloud-based pricing plan in which the price is charged on an hourly basis. It mainly depends on the number of requests to Transit Gateway per hour and the amount of traffic that flows through AWS Transit Gateway. The pricing of the Transit Gateway depends on the geographical location. More specifically, you can visit the official website at “” to request the pricing.

Cost of VPC Peering

The pricing of the AWS VPC depends on the features and capabilities used by the application. Generally, the pricing depends on various resources such as NAT Gateway Hourly Charge, NAT Gateway Data Processing Charge, and Data Transfer Charge. You visit the official site at “” to request a price quote.


In conclusion, AWS Transit Gateway and VPC Peering are powerful networking solutions catering to different use cases. Transit Gateway excels in complex architectures requiring scalable hub-and-spoke models, transitive routing, and cross-region connectivity. On the other hand, VPC Peering is suitable simpler scenarios with direct connections between specific VPC pairs, facilitating resource sharing and collaboration. After gaining complete insights into what these services are, we can easily choose the right tool for the project.

AWS Transit Gateway VS VPC Peering – FAQ’s

What Are The Alternatives For The AWS Transit Gateway?

Transit Gateway is efficient but you can also use the alternatives such as Google Cloud Router and Azure Virtual WAN, in case if it is unaffordable. Google Cloud Router allows us to connect the Google Cloud VPC and other VPCs via Cloud VPN using the Border Gateway Protocol. Moreover, the Azure Virtual WAN allows us to route the traffic to the Azure Virtual Networks (VNets), on-premises networks, and remote users.

How To Monitor The Performance Of Transit Gateway And VPC Peering?

AWS Provides various native tools like Amazon CloudWatch and VPC Flow Logs for monitoring. However, you can also use third-party monitoring solutions to monitor and analyze the performance of your Cloud Network.

What Is The Difference Between A Transit Gateway And A NAT Gateway?

Both the NAT and Transit Gateway are used for routing the network traffic. However, they differ from each other in terms of usability. The difference between both is that Transit Gateway focuses on the inter-VPC and on-premises network connectivity. On the other hand, NAT focuses on routing the outbound network for private resources.

Can We Integrate Transit Gateway With Other AWS Services?

We can easily connect the Transit Gateway with the other AWS Services such as AWS Direct Connect and AWS VPN. Thus, we can enhance the Transit Gateway to fulfill diverse requirements for cloud-based management.

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