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My dns zone contains a loopback:

localhost IN A 127.0.0.1

Do I need it, and if so why? I can't think of a reason to have it here, especially as - without a dot - it would be localhost.example.com

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Curious, I have the same on all my domains. I use a similar record to access my local test server... local IN A 192.168.1.13 - avoids the need to edit the local hosts file and works for all machines on the network. Is this related? – w3d Dec 27 '12 at 15:56
Not in my case - we use example.local and example.internal as tlds - in the question localhost is a subdomain – adam Dec 27 '12 at 16:07
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The same question was asked on ServerFault a while back: serverfault.com/questions/120769/localhost-in-a-dns-zone – w3d Dec 27 '12 at 17:50

2 Answers

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This answer on ServerFault explains what this localhost entry is for http://serverfault.com/questions/120769/localhost-in-a-dns-zone

localhost.example.com is sometimes included on internal DNS servers to prevent "localhost" requests leaking out to the internet (for the case where John Smith types http://localhost/ in his browser & for whatever reason his resolver doesn't look in the hosts file, appends his search path (example.com) & starts asking name servers what that resolves to).

It also talks about the possibility that such a DNS record could be use for Cross Site Scripting (XSS) attacks and suggest removing it for that reason.

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Thanks @Stephen, that's great! – adam Feb 25 at 15:58
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Did your DNS undergo testing because a many times loopback entry tests ability to process Web requests without actually sending any messages out. I believe it is not needed.

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