what is a proxy server?

Answer 1

A server that sits between a client application, such as a Web browser, and a real server. It intercepts all requests to the real server to see if it can fulfill the requests itself. If not, it forwards the request to the real server.
Proxy servers have two main purposes:

Improve Performance: Proxy servers can dramatically improve performance for groups of users. This is because it saves the results of all requests for a certain amount of time. Consider the case where both user X and user Y access the World Wide Web through a proxy server. First user X requests a certain Web page, which we'll call Page 1. Sometime later, user Y requests the same page. Instead of forwarding the request to the Web server where Page 1 resides, which can be a time-consuming operation, the proxy server simply returns the Page 1 that it already fetched for user X. Since the proxy server is often on the same network as the user, this is a much faster operation. Real proxy servers support hundreds or thousands of users. The major online services such as America Online, MSN and Yahoo, for example, employ an array of proxy servers.
Filter Requests: Proxy servers can also be used to filter requests. For example, a company might use a proxy server to prevent its employees from accessing a specific set of Web sites.

Answer 2

A Proxy Server is something which would allow one internet connection between multiple computers. Another utility of a proxy server is to connect to a different proxy server and then use the Internet. So the identity can be safe guarded.

Using a Proxy server would not improve anything when you are downloading torrents.

Answer 3

A server that acts as an intermediary between a workstation user and the Internet so that the enterprise can ensure security, administrative control, and caching service