Network Address Translation takes place on the boundary between public and private networks. Hosts inside the private network are assign private addresses, that are not reachable from the internet. NAT is useful when communication is needed between a host in the private network and another host in the internet.
A system, mostly a firewall or router, stores the addresses of the hosts used an intranet or other private network and converts them to publicly accessible host addresses or internet IP addresses. NAT makes it possible to use a large number of devices within the private network without depleting the limited number of available numeric internet IP addresses.
The use of NAT only delays the timeof exhaustion of ipv4 addresses but does not solve the real large-scale growth problem, because IP is now widely adopted as the applications convergence layer for non-computing devices. With ipv4, only the endpoints handle the connection and the underlying layers do not handle any connection. However, when NAT is used, it breaks the end-to-end connection of IP. Furthermore, usage of NAT adds a lot of complexity for the management of certain network services. Moreover it can have a severe performace impact on the translator device NAT also inhibits the implementation of end-to-end network security. Along the path from origin to final destination, any translation of parts of the header, which is protected by some cryptographic functions, will break the integrity check.
Furthermore, NAT requires the network to keep the state of the connections in order to handle the translation of addresses and ports. Therefore, any failure of the NAT device or links near the NAT device will make fast rerouting difficult. Additionally, every new deployment of non-NAT-friendly application will require upgrading of the NAT device.
Finnaly, different networks can use the same private address spaces. When they are combined, connected or merged, an address space collision wil result. And though the ratio of internal/reachable to external addresses mapping must be large to make NAT effective, NAT is not quite as useful if the number of inside servers is large.
source :http://www.6diss.org/
