A proxy server is a machine that sits between the proxy users and the servers that they need access to. When a proxy user requests a certain remote resource using a URL, the proxy server receives this request and fetches the resource to fulfill the client’s request. This process enables the proxy server to store the requested content in a cache. Any new request that asks for information already in the cache no longer needs to be serviced by fetching it from the remote server. Instead, the new request is serviced from the cached data. In typical proxy scenarios, the purpose of a proxy server is to fetch the requested resource from the remote server, return it to the requesting user, and cache it in local drives.

There are some types (levels) of proxy server anonymity. Anonymous proxy, high-anonymous (elite) and transparent proxy.

Anonymous Proxy shows that it's proxy. In short, a remote host can detect Anonymous Proxy as proxy, but without any information about an IP of the one who sits behind this proxy. High-Anonymous (Elite) Proxy doesn't show that it's proxy at all. Transparent Proxy changes an IP, but at the same time shows the user's real IP.