This was due to a bug in the March cumulative update.
The solution was to disable TFTP Variable Window Extension inside the WDS properties.
I have been reading of many cases where the June CU KB4503276 for Server 2012 R2, which was meant to fix the PXE booting issue is causing a PXE boot issue in WDS/MDT/SCCM.
- Uninstall KB4503276 if you are running Server 2012 R2.
Note: If you are using SCCM, you can turn on the native SCCM PXE server:
- Go to Administration > Distribution Points
- Open the properties of your DP > PXE Tab
- Tick “Enable a PXE responder without Windows Deployment Services”.
- This will take a few minutes and no reboot is required.
I hope this info helps everyone.
Please comment if you have experienced this issue?