Network Address Translation
It allows your local network to have it's own range if IP addresses, usually referred to as a private address range and usually in the range 192.168.0.1-255.
Your Router/ADSL Modem/Whatever will have it's own public address assigned by your ISP. This is the address the "rest of the world" see's when your PC's access the internet. When a private PC tries to talk to the internet the NAT service tracks the local IP address and subsitutes it for the Public address that the router has. The router then opens the connection to the destination requested and keeps track of it. When traffic comes back, eg in response to clicking on a link to view a web page the router recieves the data, the NAT service figures out which local address it needs to go to and subsititutes the correct local address and the data is sent onto the PC.
Originally developed as a way of extending the IP4 address range by allowing multiple disparate networks to use the same IP addresses, it also provides a nice additional security feature since no-one outside your network can access your PC's without you either setting up explicit rules on the router - called port forwarding - or a local PC first requesting a connection and allowing access.
Very simplified explanation but thats the gist of it. For all the gory details have a read of the original RFC
It allows your local network to have it's own range if IP addresses, usually referred to as a private address range and usually in the range 192.168.0.1-255.
Your Router/ADSL Modem/Whatever will have it's own public address assigned by your ISP. This is the address the "rest of the world" see's when your PC's access the internet. When a private PC tries to talk to the internet the NAT service tracks the local IP address and subsitutes it for the Public address that the router has. The router then opens the connection to the destination requested and keeps track of it. When traffic comes back, eg in response to clicking on a link to view a web page the router recieves the data, the NAT service figures out which local address it needs to go to and subsititutes the correct local address and the data is sent onto the PC.
Originally developed as a way of extending the IP4 address range by allowing multiple disparate networks to use the same IP addresses, it also provides a nice additional security feature since no-one outside your network can access your PC's without you either setting up explicit rules on the router - called port forwarding - or a local PC first requesting a connection and allowing access.
Very simplified explanation but thats the gist of it. For all the gory details have a read of the original RFC
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