Network Address Translation (NAT)

• you could have 4,294,967,296 unique addresses (232). The actual number of available addresses is smaller (somewhere between 3.2 and 3.3 billion) because of the way that the addresses are separated into classes, and because some addresses are set aside for multicasting, testing or other special uses.

This is where NAT (RFC 1631) comes to the rescue. Network Address Translation allows a single device, such as a router, to act as an agent between the Internet (or "public network") and a local (or "private") network. This means that only a single, unique IP address is required to represent an entire group of computers
http://computer.howstuffworks.com/nat1.htm

• NAT serves three main purposes:

Provides a type of firewall by hiding internal IP addresses
Enables a company to use more internal IP addresses. Since they're used internally only, there's no possibility of conflict with IP addresses used by other companies and organizations.
Allows a company to combine multiple ISDN connections into a single Internet connection.
http://www.webopedia.com/TERM/N/NAT.html

• Network address translation (NAT) is a methodology of remapping one IP address space into another by modifying network address information in Internet Protocol (IP) datagram packet headers while they are in transit across a traffic routing device.[1] The technique was originally used for ease of rerouting traffic in IP networks without renumbering every host. It has become a popular and essential tool in conserving global address space allocations in face of IPv4 address exhaustion.

https://en.wikipedia.org/wiki/Network_address_translat

• Network Address Translation (NAT) is the process where a network device, usually a firewall, assigns a public address to a computer (or group of computers) inside a private network. The main use of NAT is to limit the number of public IP addresses an organization or company must use, for both economy and security purposes.

http://whatismyipaddress.com/nat

• So what does the size of the Internet have to do with NAT?

When IP addressing first came out, everyone thought that there were plenty of addresses to cover any need. Theoretically, you could have 4,294,967,296 unique addresses (232). The actual number of available addresses is smaller (somewhere between 3.2 and 3.3 billion) because of the way that the addresses are separated into classes, and because some addresses are set aside for multicasting, testing or other special uses.

Network Address Translation allows a single device, such as a router, to act as an agent between the Internet (or "public network") and a local (or "private") network. This means that only a single, unique IP address is required to represent an entire group of computers.

http://computer.howstuffworks.com/nat.htm