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My machine is connected in a local lan. to connect to the internet the traffic goes through proxy server. my understanding of proxy server is that it sends the request on behalf of the original request sender. So when the server replies, it sends the reply to the proxy thinking that it is the client. The proxy then forwards the reply to my machine.
Take the case of Network Address translation. Your request goes through the nat router. The nat router then provides you a public ip address and stores this mapping in its table. The reply(from the server) is sent to this assigned public address. Which the nat router resolves to your local ip address from the table and forwards the reply to your machine.
My question why is nat required when proxy itself is able to mediate the traffic and provide you with access to the internet?

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closed as off topic by John Conde May 1 '12 at 0:17

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Please don't multi-post across multiple SE sites: serverfault.com/q/384434/47187 –  Bruno Apr 30 '12 at 19:31