Network Address Translation (NAT) is a method by which private network addresses are translated into public network addresses, allowing multiple devices on a local network to share a single public IP address. A common scenario involves a home network with several computers all accessing the internet through a single broadband connection. NAT sits between the internal network and the external internet, modifying IP address information in packet headers as they pass through.
The primary benefits of this address translation technique are improved security and conservation of public IP addresses. By hiding internal network addresses, NAT makes it more difficult for external entities to directly target individual devices within the private network. Furthermore, in an era of IPv4 address exhaustion, NAT allows organizations to utilize a limited number of public IP addresses efficiently, assigning private addresses to internal devices.