Downstream on demand label distribution is where an LSR must explicitly request that a label be sent from its downstream router for a particular FEC. Unsolicited label distribution is where a label is sent from the downstream router without the original router requesting it.

Downstream On Demand Label Distribution

In the diagram below, R1 has a route for 10.1.1.1/32 in the RIB. Because an RIP and MPLS is running everywhere in this network, it knows that R3 is the next hop for the particular FEC (destination prefix) & requests that he sends a label to R1 for the FEC. R1 can then use that label to send data via MPLS to the destination.

Unsolicited Downstream Label Distribution

In this mode, each LSR advertises a label for each FEC to the other LDP neighbors without them requesting it. Basically, each LSR just tells everyone about every label it created. So R3 says to R1 and R2, “I have a route to 10.1.1.1, use label 20 to reach it”. The same process happens on R1 and R2. The diagram below illustrates this process (assuming Penultimate Hop Popping is disabled).