Network address translation
IP Security can use devices whose addresses undergo network address translation (NAT).
NAT is widely used as part of firewall technology for Internet-connection sharing, and it is a standard feature on routers and edge devices. The IP Security protocol depends on identifying remote endpoints and their policy based on the remote IP address. When intermediate devices such as routers and firewalls translate a private address to a public address, the required authentication processing in IP Security might fail because the address in the IP packet has been modified after the authentication digest was calculated. With the new IP Security NAT support, devices that are configured behind a node that performs network address translation are able to establish an IP Security Tunnel. The IP Security code is able to detect when a remote address has been translated. Using the new IP Security implementation with support for NAT allows a VPN client to connect from home or on the road to the office through an internet connection with NAT enabled.

This diagram shows the difference between a NAT-enabled IP Security implementation, with UDP encapsulated traffic and an implementation that is not NAT-enabled.