PROXY vs NAT

Proxy vs NAT –

Proxy and NAT are 2 commonly used terms when planning for protecting a secured LAN environment in IT setups of organizations.

While NAT alters the Local IP of end systems to Public IPs for communication over the Internet, Proxy provides application-level security to end systems and mitigates vulnerabilities which may directly affect the end systems.

Proxy functions up to layer 7 of the OSI model whereas NAT functionality is limited to Layer 3 and 4.

Proxy is meant to work at application levels like HTTP and FTP while NAT is inclined towards hiding the private address in LAN and minimizing the usage of Public IP addresses (Public IPs incur the cost and are limited in number).

Related – What is Reverse Proxy

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Below table provides a detailed view of the difference between Proxy and NAT:

PARAMETER	PROXY	NAT
Terminology	Proxy is terms used for device which sits between an end system and remote server and acts as a mediator. The client requesting the resource connects to the proxy server and once validated proxy connects to remote server and provides the requested content to the client.	NAT alters IP address in a header of an IP packet and allows using Public IP for communication to outside world and private IP for communication to inside LAN.
Key functions	Provides secured Internet based application access to end hosts.	Conversion of private IP to Public IP
Layer of function	Layer 7	Layer 3/4
Protocol Specific	More Protocol Specific like HTTP,FTP etc.	More inclined towards IP addresses and less protocol specific.
End host Configuration	May require end host to be configured in case of explicit proxy. Transparent proxy may not require configuration at end host system.	No Configuration required at end host system.
NAT/Proxy device visibility	Proxies act as middlemen between 2 parties in which both end points know they are communicating with the proxy	The 2 communicating parties don’t know there is a NAT device in the middle.
Application requirement	Does not need any special application software to operate	Applications behind a proxy server must support proxy services and should be configured to use the proxy server.
Target Solution	Recommended for corporates where the user count is high and used in conjunction with NAT.	Recommended for corporates where the user count is low and light traffic flow
Cost	Costly since a dedicated proxy device is required to perform the functionality.	Cheap and no dedicated NAT device is required. NAT can be performed on any layer 3 or above device like Router, Firewall, L3 Switch etc.
Placement in network	Generally placed in DMZ Zone in a corporate network	Generally NAT is performed by Perimeter device like Internet Router or Internet Firewall.
Traffic Flow	Typical scenario – The Source system sends to traffic towards proxy with source IP as its own and destination IP that of Proxy. The proxy initiates a new session with its own IP as Source and destination IP that of remote Server.	Typical scenario – The Source system (using private IP) sends to traffic towards destination remote Server. The NAT device converts the source/destination private IP into Public IP and sends towards remote Server.
Data Caching	Supported	Not Supported
Information and Traffic Control	High level of Control since works upto Layer 7	Limited level of traffic control
Overhead	High associated overhead since in proxy each packet is analyzed and then action performed.	Much simpler and very less associated overhead
Key Benefits	Improved security and control over end System access to outside world	NAT is hiding a number of private IPs behind a smaller number of public IPs to alleviate the shortage of IP addresses
Related terms	Explicit proxy, transparent proxy, caching, URL and content filtering	NAT overload, PAT , Static NAT etc.