What is a proxy server
A proxy server is a kind of buffer between your computer and the Internet resources you are accessing (Web sites, FTP archives etc.). The data you request come to the proxy first, and only then it transmits the data to you.
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What is an anonymous proxy server
Any web site in the world can track your movements through its pages and monitor your reading interests using your IP address, a unique ID assigned to each computer on the Internet. Depending on the policies of the Internet resource, you might not be able to get access to the information you need. Also, your visit can be registered and used later to gather some personal information about you.
It is widely agreed that governments and organizations publish dummy websites on controversial topics for the purpose of monitoring interested parties. Also, this information, in combination with your e-mail address, can be used to increase the number of targeted advertisements fired at you by the marketers.
Using only your IP address and the information about your operating system, a Web site can automatically exploit security holes in your system using some not-very-complex, ready-made, free hacking programs. Some of such programs may just hang your machine, making you reboot it, but other, more powerful ones, can get access to the content of your hard drive or RAM. The anonymous proxy prevents this by hiding your IP address so that no one can access your computer via the network. In most cases, however, proxies do inform the target server about the address of the computer that made the request, transmitting your IP-address in different forms.
Anonymous (real anonymous!) proxy servers don't transfer the information about the IP-address of the client, and thus effectively hide the information about you and your surfing interests. Besides that, some proxy servers can also hide the very fact that you are surfing through a proxy server! Anonymous proxies can be used for all kinds of Web-services, such as Web-Mail (MSN Hot Mail, Yahoo mail), web-chat rooms, FTP archives, etc.
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What is a free proxy server
It is a proxy server which is free and open for everybody on the Internet. There is quite a large number of public proxy servers in many countries but most of them are not anonymous.
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Proxies Classification for "Dummies"
There are several types of proxies. Proxy of each type is designed to solve its specific tasks, however they have much in common, and their abilities coincide in many features.

HTTP Proxy
It is the most widespread type of proxy servers and when you hear just "proxy", it means nothing, but this type of a server. Earlier with a help of this proxy it was only possible to view web pages and pictures and download files. Now, new program versions (ICQ, etc.) know how to work through the HTTP proxies. Browsers of any versions know how to work with this type of proxy.

SOCKS Proxy
These proxy servers know how to work practically with any type of information on the Internet (TCP/IP protocol), however for their use in programs there should be obviously indicated a ability to work with SOCKS proxy. Some additional programs are necessary for using of SOCKS proxies within a browser (browsers do not know how to work through SOCKS proxy). However, any ICQ versions (and many other popular programs) can work perfectly through the SOCKS proxies. At last, we want to pay attention, while working with socks proxies it is necessary to specify its version: socks 4 or socks 5.

CGI Proxy (anonymizer)
This type of proxy server could be accessed only with a browser. In other programs their using is complicated (and one does not need it, there are HTTP proxies). However as this type proxy is initially designed for operation through a browser, one can use it in a very simple way. Moreover, you can construct a chain from CGI proxies without any problems.

FTP proxy
This type of proxies is highly specialized and aimed for work only with FTP servers. You can use these proxies in most popular file managers (FAR. Windows Commander, etc.), download managers (CuteFTP, GetRight, etc.) and in browsers
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Is the "anonymous proxy" I came across on the Internet really an anonymous one?
Most probably, No. We have studied more than 1,000 public proxy servers and found that only a few hundred of them are true anonymous proxy servers. Although almost half of all servers call themselves "anonymous" because they do not transfer the client's IP address in the standard way, nevertheless the address is present in their requests in other different forms and therefore they do not provide any anonymity. Besides, we found that some proxies transfer the IP address of the client occasionally, from time to time.
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Can a proxy make me anonymous to HotMail, Yahoo! Mail, etc, so that I can send anonymous e-mail
Yes. As long as you are connected to the HotMail server through an anonymous proxy server, your IP address is hidden, and all e-mail that you send with the web-forms on the HotMail server has no track of your true location. It is so for all web-based e-mail services, like mail.com, as well as for web-based chat boards like Yahoo! Chat. There is a possible trap, however: many of such services use a secure connection when you send e-mail or when you logon to your account. Therefore it is very important to make sure that your proxy supports HTTPS and configure your browser to use the proxy for the Secure protocol in addition to the ordinary HTTP.
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I have downloaded a free proxy server, but proxy doesn’t work, though it’s a successfully tested. What could be the reason
There could be several reasons:
1. The proxy server is operational, but because it's remote from you and the proxy is too slow, it takes quite a while for the response to reach your PC - therefore, you think the proxy doesn't work;
2. Your ISP has restricted access to certain web-sites and then it has found out your were using the proxy server to access these prohibited web-sites. As a result, your ISP has restricted access to this proxy server (only!) for you (only!).
3. The proxy server's ISP (a proxy-server is a computer connected to the Internet, it also has its own ISP) has denied access to the proxy server from your network (or from your ISP - for competition reasons :-) ). In fact, there could be many reasons for this, absolutely beyond you and not anyhow related to you;
4. The proxy server's settings prohibit the use of the proxy server from your network (see item 3);
5. This proxy server is a corporate proxy, that means it has a list of computers (allowed IP addresses) which are allowed to use it. In this case, even if your neighbour uses this proxy successfully, access to this proxy server may be closed for you;
6. And finally... It could be that you have set your proxy incorrectly! These things also happen. See proxy FAQ on how to set up a proxy server.

Conclusion: even if a proxy server works fine with "everyone", it doesn't mean it will work with you => there are no 100% working proxy servers that work everywhere!
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How to bypass a corporate proxy server
In this case you can use:

• anonymizers (CGI proxy)
• a chain of proxy servers (read about proxy chaining in our proxy FAQ)