Proxy servers operate as an intermediary between a local network and Internet. Requests from local clients for web services can be handled by the proxy server. Squid is a high-performance HTTP and FTP caching proxy server. It is also known as a Web proxy cache. As it stores data from frequently used Web pages and files, it can often give your users the data they need without their systems having to look to the Internet.
So let's begin the tutorial.
Firstly we should install the squid in our linux system.
It's different from each linux dist but here i will get the ubuntu OS for example. And there is no more difference on these steps just browse over internet to know how to install squid to your linux OS.
Ok get the terminal and type
apt-get install squid3
As i said this is for ubuntu. apt-get install will remains as same in other Linux OSs. But dunno about squid.
Then we have to set a static IP to our server. Go to System Settings and Networks. You can change the IP, Gateway, DNS there without bothering of the commands in the terminal.
To check surely the Squid has installed in the system go to etc folder in file system or root. Try to find something like squid. In this case it's "squid3".
Go to the terminal and type
sudo nano /etc/squid3/squid.conf
Using this command we are going to open the squid.conf with nano for editing purpose.
Then you will see a more than 5000 lines of doc in there.
press ctrl+w and searching menu will appear. type visible_hostname. It will go to the point that phrase exist and when you slowly scroll down you will see under the default: , after the visible_hostname localhost or something. Give it a desired name or it's better to use your machine host name (type in the terminal hostname and enter.)