Can a person just build a proxy server with extra pc's laying around?

I'm not very clear on proxy servers, obviously and maybe this is a dumb question, but can a person just set up a proxy server in their home with extra pc's laying around, or would you actually need a server?  What server software do you need and what hardware?  Will that hide your ip address outside the LAN better than a web hosted proxy?
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you need regular pc and Microsoft Windows 2003 ISA server software
It will not hide your public IP address you have it a little wrongfully. ex. Your ISP provider assigned you 1 IP address but you connected 5 computers at home your 5 computers using whats called fake ip addresses which invisible to outside world, but whenever you browse internet you browse it with your ISP assigned address. So in reality your computer cannot be reached directly by typing address it could be reached by hacking your router or proxy server and then relaying in to your computer which is hard, very hard. this is called NATING.
to hide your public ip address from real world you will have to go through different Proxy servers around the world there is a billion open proxy servers, but if you will setup local proxy it won't help you.
>you need regular pc and Microsoft Windows 2003 ISA server software

s/need/can use/


There's no strict definition of a 'server'.  Any piecel of hardware from a low end PC to a mainframe could be considered to be a server.  You can run proxy server on pretty much any hardware you like.  A proxy server doesn't use many resources for a home environment, so you'd be able to use hardware with low specifications.

As for proxy server software, there are so many to choose from.  Squid is very popular in the Linux world (also runs on Windows), but may be a little overkill for a home setup.

Your typical proxy server setup looks like:

Proxy Server (with public IP address)
Home LAN (on private IP address range)

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