Every participant on the Internet needs an IP address. Participants even need a special kind of IP address - a public one. The administration of public IP addresses is handled from central locations in the Internet. Each public IP address may only occur once on the entire Internet.
Local IP-based networks do not use public, but private IP addresses. For this reason, a number of address ranges within the entire IP address range have been reserved for private IP addresses.
A computer connected to both a local network and directly to the Internet therefore has two IP addresses: a public one for communication with the rest of the Internet and a private one by which the computer can be reached within the local network.
