IP addresses are divided into public and private ranges.
Public IP addresses:
- Globally unique and routable on the internet
- Assigned by ISPs and regional registries
- Must be paid for or leased
Private IP addresses:
- Only valid within your local network
- Not routable on the public internet
- Free to use by anyone
Why this matters: If your home uses 192.168.1.x, so can your neighbor's. Both work independently. Neither can reach the other's private addresses.
NAT bridges the gap by translating private to public addresses.