In
TCP/IP, the 127.0.0.0/8
netblock is reserved for the
loopback interface on each network-connected
host. This is a
Class A netblock, equal to 2
24 addresses, reserved entirely for each host to communicate
with itself.
The most commonly used address for a loopback interface is 127.0.0.1, but there is no restriction on how many of these addresses a host may use. The stereotypical use for loopback addresses is testing of network programs -- but any time you refer to localhost on a Unix system, you're probably referring to the loopback.
No address in the loopback range is valid on any physical IP network. Packets with source addresses in this range can confuse older network stacks (see martian).