Can you explain how redirect to localhost works?

In an application developed in asp.net 1.1 with c# I implemented a change to incorporate 3-D Secure for credit card payments. This involves redirecting customers to another site to validate their card and then the customer is redirected back to our site. When redirecting a dynamically generated page containing hidden values, including a return url, is posted to the other site. I using string redirecturl = Request.Urlreferrer.AbsoluteUrl + "?Redirect=y" to set up the return url. What I have found and didn't expect is that even when I run a local copy of the application it still returns back.
JamesJMcDonnellAsked:
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john_steedConnect With a Mentor Commented:
http://localhost always refers to your own computer. Other sites can redirect back to it, but only when YOU open those sites in your browser.
It won't work if someone else gets redirected to localhost (because it will search for a site on his PC)
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john_steedCommented:
Hey,

The redirect to localhost only works on computers that have the website installed on their localhost. You're code however should be correct, since when you move to a production environment, the return url will be correct

Hope this helps
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JamesJMcDonnellAuthor Commented:
Just checking: So if the site is being developed on a pc's c: drive with a virtual directory in iis, then that means the site is installed on the pc ? and also another site is able to redirect back to the application running locally on that pc?  But how can their be a unique IP address, is this not needed?
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JamesJMcDonnellAuthor Commented:
Thanks
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