What is the purpose of the Microsoft Loopback Adapter?

Here's an explanation that might be a bit easier to understand - one I'm working on at the moment.

We (a Bank) are pretty damn secure, as you would expect. One of our third party vendors requires the POS java app that we have to use connect to a 172.x.x.x address. Well, that's not routable.

So we have loopback adapters, one for each of their 172.x.x.x addresses, with the address we will allow as the IP. We then use the "netsh" command to redirect traffic...

So any traffic that access, for example, 172.1.1.1 will get intercepted by Loopback Adapter #1 and redirected to 10.2.2.2. The pain is having one adapter per address.

Hope that makes it a little clearer.

Well, the best answer I can give you is a few links. http://en.wikipedia.org/wiki/Loopback The key sentence here is

"Any traffic that a computer program sends to the loopback interface is immediately received on the same interface."

http://www.juniper.net/techpubs/software/erx/erx50x/swconfig-system-basics/html/system-mgmt15.html This may be a little more obscure if you don't know networking well.

Basically, it's a fake network interface, useful for tests and stability. In practice, most likely something you'll never have to worry about (or you'd already know about it!)

When sending messages to 127.0.0.1 (or the localhost) the internal network driver typically handles this by shortcutting a few steps.

If you have a networksniffer/protocol analyzer like wireshark, it can not see these shortcutted packets.

By using a loopback adapter, the messages get send much further through the stack, enabling programs like wireshark to capture the packets (and enabling you to analyze the packets)