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Network Address Translation (NAT) Definition & Meaning

Network Address Translation (NAT) is an Internet standard that enables a local-area network (LAN) to use one set of IP addresses for internal traffic and a second set of addresses for external traffic. Developed by Cisco, the NAT process relies on a device (usually a router) to make all necessary IP address translations where the LAN meets the Internet. 

NAT serves three practical purposes:

  1. To provide a type of firewall by hiding internal IP addresses
  2. To enable a company to use more internal IP addresses*
  3. To allow a company to merge multiple ISDN connections to form a single Internet connection

*Since the IP addresses are only used internally, there is no risk of external conflict with those used by other companies or organizations—see overlapping overview below.

Main types of NAT

  • Dynamic NAT refers to the process of translating private IP addresses to public IP addresses within a specified range (called a NAT pool).
  • Static NAT refers to the process of translating private IP addresses one-to-one to the same public IP address. 
  • Sometimes called Port Address Translation (PAT) or single address NAT, overloading refers to a version of dynamic NAT in which all of the private IP addresses are translated to the same public IP address using different ports.
  • Overlapping occurs when the private IP addresses in an internal network (sometimes called a stub domain) are the same as those in an external network, meaning the NAT router must keep a lookup table so it can compare the two and translate accordingly.









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