A program which forwards HTTP, HTTPS and FTP requests, often caching them.
Squid is a widely used open source (free software) proxy server.
Some ISPs have "transparent proxies", where all web traffic gets redirected to a proxy without any knowledge (or choice) of the users. This is because in New Zealand, all international traffic incures data charges, so if the ISP can serve you a cached copy, they can save a couple of cents per megabyte.
See Also ProxyServerNotes
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