While Squid has been the traditional choice for local network proxying, Nginx offers several compelling advantages:

• Lightweight resource usage compared to Squid's memory footprint
• Superior handling of concurrent connections
• Built-in caching mechanisms that outperform Squid in many scenarios
• More flexible configuration syntax
• Ability to serve as both web server and proxy simultaneously

Here's a minimal configuration to get started with Nginx as a forward proxy:

http {
    server {
        listen 3128;
        location / {
            resolver 8.8.8.8;
            proxy_pass http://$http_host$request_uri;
            proxy_set_header Host $http_host;
            proxy_buffering off;
        }
    }
}

For better performance on local networks, implement caching:

proxy_cache_path /var/cache/nginx levels=1:2 keys_zone=PROXYCACHE:100m inactive=24h max_size=1g;

server {
    listen 3128;
    proxy_cache PROXYCACHE;
    proxy_cache_valid 200 302 60m;
    proxy_cache_valid 404 1m;
    
    location / {
        resolver 8.8.8.8;
        proxy_pass http://$http_host$request_uri;
        proxy_set_header Host $http_host;
    }
}

Secure your proxy with basic authentication:

server {
    listen 3128;
    auth_basic "Restricted Access";
    auth_basic_user_file /etc/nginx/.htpasswd;
    
    location / {
        # Proxy configuration
    }
}

Generate password file using:

htpasswd -c /etc/nginx/.htpasswd username

• Adjust worker_processes to match CPU cores
• Set worker_connections based on expected load
• Enable keepalive_timeout for persistent connections
• Consider using shared memory zones for active connections

Add these directives to monitor proxy performance:

log_format proxy_log '$remote_addr - $remote_user [$time_local] '
                    '"$request" $status $body_bytes_sent '
                    '"$http_referer" "$http_user_agent" "$upstream_cache_status"';

access_log /var/log/nginx/proxy_access.log proxy_log;

While Squid has been the go-to proxy solution for many network administrators, Nginx offers several compelling advantages for local network proxying:

• Lightweight resource consumption compared to Squid
• Superior handling of concurrent connections
• Flexible configuration with support for modern protocols
• Built-in caching capabilities
• Seamless integration with other web services

Here's a minimal configuration to get started with Nginx as a forward proxy for your local network:

http {
    server {
        listen 3128;
        location / {
            resolver 8.8.8.8;
            proxy_pass http://$http_host$uri$is_args$args;
            proxy_set_header Host $http_host;
            proxy_buffers 256 4k;
            proxy_max_temp_file_size 0;
        }
    }
}

To optimize performance for frequently accessed resources:

proxy_cache_path /var/cache/nginx levels=1:2 keys_zone=my_cache:10m inactive=60m;
proxy_cache_key "$scheme$request_method$host$request_uri";

server {
    listen 3128;
    location / {
        proxy_cache my_cache;
        proxy_pass http://$http_host$uri$is_args$args;
        proxy_cache_valid 200 302 10m;
        proxy_cache_valid 404 1m;
    }
}

For securing your proxy server:

server {
    listen 3128;
    auth_basic "Proxy Authentication";
    auth_basic_user_file /etc/nginx/.htpasswd;
    
    location / {
        proxy_pass http://$http_host$uri$is_args$args;
        allow 192.168.1.0/24;
        deny all;
    }
}

• Connection pooling: Keep upstream connections open for reuse
• Buffering control: Fine-tune proxy_buffer_size and proxy_buffers
• TCP optimizations: Adjust keepalive_timeout and tcp_nodelay
• DNS caching: Implement resolver with cache for faster lookups

Essential directives for tracking proxy activity:

log_format proxy_log '$remote_addr - $remote_user [$time_local] '
                     '"$request" $status $body_bytes_sent '
                     '"$http_referer" "$http_user_agent"';

access_log /var/log/nginx/proxy_access.log proxy_log;
error_log /var/log/nginx/proxy_error.log;

Nginx excels in these local network proxy scenarios:

• Content filtering for educational institutions
• Bandwidth optimization in office environments
• Testing environment isolation
• Secure browsing for IoT devices
• Media streaming optimization