Every device that connects to the Internet must have its own, unique IP number. These are assigned centrally by a designated authority for each country.
If you are connecting a local area network (LAN) to the Internet, YOU MUST use an IP number from your own assigned network range for all the computers and devices you have on your LAN. You MUST NOT pick IP numbers out of the air and use these whilst connecting to another LAN (let alone the Internet). At worst this will simply not work at all and could cause total havoc as your 'stolen' IP number starts interfering with the communications of another computer that is already using the IP number you have picked out of the air.
Please note that the IP numbers used throughout this document (with some exceptions) are from the 'unconnected network numbers' series that are reserved for use by networks that are not (ever) connected to the Internet.
There are IP numbers that are specifically dedicated to LANs that do not connect to the Internet. The IP number sequences are:-
One A Class Network Address 10.0.0.0 (netmask 255.0.0.0)
16 B Class Network Addresses 172.16.0.0 - 172.31.0.0 (netmask 255.255.0.0)
256 C Class Network Addresses 192.168.0.0 - 192.168.255.0 (netmask 255.255.255.0)
If you have a LAN for which you have not been allocated IP numbers by the responsible authority in your country, you should use one of the network numbers from the above sequences for your machines.
These numbers should never be used on the Internet.
However, they can be used for the local Ethernet on a machine that is connecting to the Internet. This is because IP numbers are actually allocated to a network interface, not to a computer. So whilst your Ethernet interface may use 10.0.0.1 (for example), when you hook onto the Internet using PPP, your PPP interface will be given another (and valid) IP number by the server. Your PC will have Internet connectivity, but the other computers on your LAN will not.
However, using Linux and the IP Masquerade (also known as NAT - Network address Translation) capabilities of the Linux and the ipfwadm software, you can connect your LAN to the Internet (with some restriction of services), even if you do not have valid IP numbers for the machines on your Ethernet.
For more information on how to do this see the IP Masquerade mini-HOWTO at Linux IP Masquerade mini HOWTO
For most users, who are connecting a single machine to an Internet service provider via PPP, obtaining an IP number (or more accurately, a network number) will not be necessary.
If you wish to connect a small LAN to the Internet, many Internet Service Providers (ISPs) can provide you with a dedicated subnet (a specific sequence of IP numbers) from their existing IP address space. Alternatively, use IP Masquerading.
For users, who are connecting a single PC to the Internet via an ISP, most providers use dynamic IP number assignment. That is, as part of the connection process, the PPP service you contact will tell your machine what IP number to use for the PPP interface during the current session. This number will not be the same every time you connect to your ISP.
With dynamic IP numbers, you are not necessarily given the same IP number each time you connect. This has implications for server type applications on your Linux machine such as sendmail, ftpd, httpd and so forth. These services are based on the premise that the computer offering the service is accessible at the same IP number all the time (or at least the same fully qualified domain name - FQDN - and that DNS resolution of the name to IP address is available).
The limitations of service due to dynamic IP number assignment (and ways to work around these, where possible) are discussed later in the document.