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What is a Proxy Server? Definition, How It Works & More

by Chris Brook on Monday May 8, 2023

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Proxy servers can add an extra layer of security for users and organizations alike. In this blog, we break down how proxy servers work and what their benefits are.

A proxy server acts as an intermediary or middleman between a user and the websites they browse. They can be set up as a firewall or a web filter, acting as a layer of cybersecurity that prevents cyber attackers from entering a private network and protects your computer against malware and other cyber threats. In this article, we’ll discuss what a proxy server is, how it works, and its various benefits and use cases.  

What is a Proxy Server? 

A proxy server is a gateway that anonymously passes data between users and the internet. The proxy itself could be a computer system or a router.

When an individual uses a browser, they normally communicate directly with the internet, but with a proxy server, the proxy communicates with the internet on their behalf.

When someone uses a proxy server, the internet traffic goes through the proxy before reaching the destination computer. Since all communication is happening through the proxy, it offers some level of security and privacy, and a number of IT companies depend on proxy servers to filter out any potentially harmful data that might come in from the internet.

According to the FBI’s IC3 report for 2021, the United States received nearly 850,000 cybercrime complaints in 2021, an increase of 7.9% from the previous year, while the potential losses due to these crimes amounted to $6.9 billion. With this plethora of cyberattacks, it only makes sense to invest in security and privacy.

While proxy servers perform many important functions, the main reasons they are used are as follows:

  • To filter incoming traffic, making the company’s network more secure
  • To keep the company’s network more private
  • To speed up access to resources through the use of a cache

How Does a Proxy Server Work?

All devices connected to the internet have an internet protocol (IP) address. This address is how a device is recognized on the internet, and it plays a role in how proxy servers work. Proxies can have different ways of working, but the following steps are common among all proxy servers:

  • When a device makes a request to the internet through a proxy, the proxy server reads and interprets the request.
  • That request is then forwarded to the right internet server.
  • The internet server reads the IP of the proxy and sends the requested data to the IP of that proxy.
  • The proxy server receives the data, extracts it, and checks it for possible malware.
  • Once marked safe, the data is forwarded to the requesting device.

Benefits of Proxy Servers

Proxy servers have a fairly simple mechanism and yet add a lot of value to an IT company or other corporate entity. Here are some of the primary benefits and use cases for proxy servers.

Improved Security

This is the main reason why companies use proxy servers, as data breaches are expensive and can result in huge losses. Global losses due to cybercrime reached over $6 trillion in 2021 and is expected to top $10.5 trillion annually by 2025.

As a proxy server filters out malicious data from the internet before it reaches the company’s servers, it can act as an additional layer of security. A proxy server alone might not save the company’s network from all hacking attempts, but it can add to the security of the system and lower the risk of cyberattacks.

It can also help a company against phishing, identity or brand theft, DDoS attacks, and other malware attacks.


Since proxies sit between company networks and internet servers, the internet is unable to know the company IP that generated the request. A company’s research and development process, part of its intellectual property, is crucial for its success and must be protected. When an additional layer of security is present between the unfiltered internet and the company servers, it protects sensitive company data from being stolen.

For example, if a spy is monitoring the network, a proxy can prevent the spy from finding out what the employees are searching for online.

Faster Speed

Caching is another important function performed by proxy servers. More frequently visited sites can be cached by the proxy, thereby eliminating the need for the proxy to send a request to the internet servers whenever a request is made for those pages,.

More than that, proxy servers also compress traffic and remove ads from websites, thereby making the internet faster than usual.

Control Internet Usage

Proxies can be used to block undesirable content. For example, some companies might want to block certain social media sites so their employees aren’t distracted from their work. A proxy server also lets network administrators monitor the requests sent to the internet to ensure no illegal or improper activities are being carried out.

Bypassing Restrictions

Some websites only allow access to IPs from a certain location. This can be a problem when a business needs to access a geo-restricted website, but when a company uses a proxy server, the IP is masked and employees can access the content they need.

How are Proxy Servers Used?

The proxy itself sits outside the firewall and protects the servers, but companies and organizations can install proxy network software on each individual computer if necessary. The proxy can also be a standalone computer or a router installed between two separate devices on the company’s network.

When a proxy sits between two devices, it accepts requests, sends them to the required destination, gathers responses, and forwards them to the requesting device.

Are Proxy Servers Similar to VPNs?

Proxy servers are similar to VPNs in some ways. For example, they both let users hide their IP addresses and help bypass geo-restrictions.

However, a proxy server doesn’t encrypt the network traffic. A VPN, on the other hand, encrypts network traffic and adds another layer of safety.

However, a VPN doesn’t use a cache to speed up internet access, whereas a proxy can improve the speed of access with its caching capabilities.

In general, a VPN is trusted more by companies, thanks to its ability to encrypt data, but for personal use, a proxy might be enough. However, in business scenarios where breaches are expensive, VPNs could be a better choice.


A proxy server is an intermediary between end users and the internet that offers benefits such as:  

  • Improving security
  • Providing anonymity
  • Improving browsing speed
  • Allowing for control over internet usage
  • Bypassing geo-restrictions 

While it’s just one component of security, it can help to prevent cyber attackers from accessing private networks and protect individual computers from malware and other threats.

Frequently Asked Questions

Is a VPN a proxy?

A virtual private network (VPN) is not the same as a proxy. While both entities hide your IP address and give you enhanced privacy, they are different. The major difference is that a VPN hides your IP address and works with every website you visit while a proxy is configured for a specific site or application. A VPN also typically provides better security by encrypting your data before transmitting it over a network.

What happens when you set a proxy?

When you set a proxy, it acts as a middleman and forwards requests to the resource you want to access. The proxy server then accepts the results and returns them to the original requestor. There is no direct communication between the requestor and the resource they are accessing.

Who should use a proxy server?

Proxy servers can be used for several reasons. Organizations or individuals that need the following functionality should consider setting up a proxy server.

  • Content filtering and network security are possible with a proxy server.
  • A proxy server can be used to bypass censorship and content filtering.
  • Reverse proxies are useful for handling fluctuating website traffic.
  • SOCKS proxies are similar to VPNs as they can be used to funnel traffic to another server to avoid filtering or masking an IP address.

Would a hacker use a proxy?

Hackers use proxy servers to hide malicious network activity such as DDoS attacks and phishing attempts. Hackers may also infect a proxy with malware so that unsuspecting users will have the malicious software installed on their machine when using the proxy. For this reason, it can be dangerous to use free proxy services advertised on the Internet.

What is the difference between IP and proxy?

Internet Protocol (IP) and a proxy server are two completely different things. IP is a set of standards for addressing and routing data packets across computer networks to ensure they reach the correct destination. A proxy is a server that provides a gateway between users and the Internet and is used as a middleman between the user and the resources they are accessing.

Tags:  Cybersecurity Privacy

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