NVE (Network Virtualization Endpoint) interfaces provide VXLAN overlay network capabilities that enable Layer 2 and Layer 3 network virtualization across IP infrastructure, supporting multi-tenancy and network segmentation in modern data center architectures. They facilitate the creation of virtual networks by encapsulating Ethernet frames in UDP packets with VXLAN headers, enabling seamless connectivity between geographically distributed sites while maintaining Layer 2 adjacency and supporting features like host mobility and flood optimization. NVE interfaces are essential components of EVPN-VXLAN deployments, providing the foundation for scalable multi-tenant networks, micro-segmentation, and cloud connectivity solutions that require flexible, software-defined networking capabilities.