The Linux Terminal Server Project adds thin client support to Linux servers. It allows you to set up a diskless workstation environment with not much effort. LTSP is a flexible, cost effective solution that is empowering schools, businesses, and organizations all over the world to easily install and deploy thin clients.
Requirements:
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Ubuntu 12.04 x64 machine to act as our main LTSP server.
1 x Network switch / hub
1 x Router with internet connection
Thin client computer. This can be any network boot enabled machine.

Steps to install LTSP Server in Ubuntu
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If you have an already installed Ubuntu machine, type the following command to install LTSP server.

and build the client image

Change the Network adaptor to use Manual IP and set a new fixed IP for the adaptor and save.


    # The primary network interface
    auto eth0
    iface eth0 inet static
            address 192.168.1.225
            netmask 255.255.255.0
            network 192.168.1.0
            broadcast 192.168.1.255
            gateway 192.168.1.1
            dns-nameservers 192.168.1.1
            dns-search home

Change 192.168.1.225 to your server IP address.

Install dnsmasq and configure dhcp server.
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Edit the /etc/dnsmasq.d/ltsp.conf file and made the appropriate changes(dhcp range, etc) if any.

Restart the dnsmasq.

Create a custom lts configuration file.

and add the following contents.

[Default]
SCREEN_02=shell
SCREEN_07=ldm

Set up Thin Client Admin user
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Change <adminname> with your new administrative username.

Then update the client image

Whenever you changed the Ip address, dont forget to run

Finally, Configure client machine's BIOS to bootup using PXEboot or set first boot device as Network boot.