NAT became necessary because the number of IP address are too few to cover all of computers to be connected to the Internet after the number of computers connected to the Internet exponentially increased. NAT is vital particularly in the countries other than the United States, where the assigned IP addresses are relatively too few.
Personal routers usually provide NAT as its core function. Those routers are quite popular in some countries such as Japan.
Some people regard NAT as a detriment to the Public Internet, since it destroys end-to-end connectivity which the Internet Architecture Board[?] has stated as a goal. Many people do not regard users connected behind a NAT-enabled gateway as real Internet users, hence a discussion has arisen as to whether some Internet Service Providers sell Internet service at all (some ISPs only sell NAT-based services, which do not inherently provide end-to-end connectivity).
In addition to the necessity, some arguments proposed in favor of NAT are simplicity and security. Some also claim that the shortage of IP addresses[?] problem is non-existent. However, Internet consultants most often disregard such arguments as nonsense or incompetence, and often propose IP version 6 as a long-term alternative for those who need many devices. IPv6 assignment policies ensure that even end users get a well-sized pool of IP addresses for devices such as Computers, Set-top Boxes[?], Internet Phones[?] and other network devices.
There are two kinds of network address translation. What is often called simply "NAT" is also sometimes named "NAPT", and refers to network address translation involving the mapping of port numbers, allowing multiple machines to share a single IP address. The other simpler form is also called NAT, or "basic NAT" or "static NAT", and involves only address translation, not port mapping. This requires an external IP address for each simultaneous connection. The feature is often found in ADSL routers, sometimes labelled "DMZ host", to allow a computer to accept all external connections even when the only available external IP address is used by the router itself.
NAT with port-translation can be further distinguished to two kinds: source address translation (source NAT), where the IP address of the computer which initiated the connection is rewritten, and its counterpart: destination address translation NAT (destination NAT).
IP masquerading is a particular case of source NAT; this is a common technique often used to allow multiple computers to relatively transparently share an Internet connection. To the computers on the local network, the "NAT box" looks like just another router, but in reality, it is doing all sorts of magic.
When the computer performing the NAT routes the systems behind it onto the Internet, it transparently changes the source IP address of the internal system to its external (Internet) address and remembers basic data about the connection. The packet then traverses the Internet to its destination as if it had been generated by the router itself. When the reply is sent back, the router looks at the connection tracking data it stored before and determines where to send it back on the internal network.
The benefits of NAT are great. It allows many computers to access the internet utilizing only a single IP address on the internet. This not only saves money for the organization employing NAT, but also conserves addresses on the internet as few are still available. Another benefit of NAT is the ability to conceal the internal configuration of your network from external observers such as hackers or your ISP.
Downsides of NAT include difficulty in using services that require the initiation of TCP connections from the outside network, or stateless protocols such as those utilising UDP; unless the NAT router makes specific effort to support such protocols, incoming connections cannot reach their destination.
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