Azure NAT Gateway: Secure and Scalable Outbound Connectivity for Your VNets
By Pooja | 10th July 2025
Introduction
When deploying cloud-based applications, many scenarios require virtual machines (VMs) or resources inside an Azure Virtual Network (VNet) to access the internet, such as downloading updates, calling APIs, or accessing external services. However, for security and compliance reasons, you may not want those VMs to have public IPs.
To solve this, Azure offers Network Address Translation (NAT) Gateway—a fully managed, scalable solution that provides secure, efficient outbound internet connectivity without exposing your VMs to inbound connections.
This article explores what Azure NAT Gateway is, why it’s important, how to configure it, and how it compares with other Azure networking tools.
What is Azure NAT Gateway?
Azure NAT Gateway is a fully managed outbound-only internet connectivity solution for virtual networks. It uses source Network Address Translation (SNAT) to allow Azure resources in a private subnet to connect to external internet endpoints without assigning a public IP to each VM.
In simpler terms, it’s a cloud-native egress-only gateway that:
- Provides consistent and scalable outbound IP addresses
- Eliminates the need for public IPs on individual VMs
- Prevents unsolicited inbound connections
- Works at the subnet level in a VNet
Why Use NAT Gateway?
Without a NAT Gateway, Azure VMs in a private subnet can:
- Use the default system-assigned public IP (limited)
- Use instance-level public IPs (less secure and costly)
- Use an Azure Load Balancer with outbound rules (less scalable)
These approaches can lead to:
- IP exhaustion
- Port exhaustion (when many VMs share limited SNAT ports)
- Lack of control over outbound IP addresses
- Inconsistent and dynamic outbound IPs
NAT Gateway solves all of these problems by providing:
- Dedicated IP addresses for outbound traffic
- Large port ranges for high-scale applications
- Predictable outbound behavior
Key Features of NAT Gateway
- Outbound-Only Connectivity: Blocks all unsolicited inbound traffic
- Static Public IP(s): Use one or more static public IPs or IP prefixes
- Port Management: Up to 64,000 SNAT ports per public IP
- High Availability: Built-in redundancy and fault tolerance
- Scalability: Supports thousands of concurrent connections
- Simplified Management: No need to configure NAT tables or firewall rules
- Integration with Subnets: Easily associate with one or more subnets
NAT Gateway Architecture
Azure NAT Gateway is deployed at the subnet level. Any VM, container, or service in that subnet without its own public IP will:
- Route all outbound traffic through the NAT Gateway
- Use one of the associated public IP addresses as the source IP
- Have inbound traffic blocked, unless initiated by the VM
Architecture Diagram (conceptual):
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+——————————-+
|         Azure VNet          |
|Â +————————-+Â |
|Â |Â Â Â Â Â Â Â Subnet AÂ Â Â Â Â Â Â Â |–|– NAT Gateway (Static IP x.x.x.x)
|Â | +———————+ |Â |
|Â | |Â Â Â Â VM1 (Private)Â Â | |Â |
|Â | |Â Â Â Â VM2 (Private)Â Â | |Â |
|Â | +———————+ |Â |
|Â +————————-+Â |
+——————————-+
             |
         Internet
How NAT Gateway Works
SNAT (Source NAT)
- A VM with a private IP address initiates a connection to an external IP.
- The NAT Gateway translates the private IP to a public IP from its pool.
- The external server responds to the public IP.
- NAT Gateway forwards the traffic back to the originating VM.
This means:
- VMs never expose their private IPs
- NAT Gateway keeps track of each connection (stateful)
- Each public IP can support up to 64,512 SNAT ports
NAT Gateway vs Azure Load Balancer (Outbound Rules)
Feature | NAT Gateway | Azure Load Balancer (Outbound Rules) |
Primary Purpose | Outbound-only NAT | Load balancing + outbound NAT |
Outbound IP control | Yes (static IPs or prefix) | Limited |
SNAT Port Scalability | High (64K per IP) | Low (~1024 per IP) |
Port Exhaustion Management | Handled automatically | Risk of exhaustion |
Simplicity | Easy | Requires outbound rules configuration |
Inbound NAT or Load Balancing | No | Yes |
NAT Gateway is recommended when you only need outbound connectivity and require predictability, performance, and scale.
Public IP Prefix and NAT Gateway
You can assign either:
- One or more public IP addresses, or
- A public IP prefix (a reserved block like /29 or /28)
Benefits of using public IP prefix:
- All IPs are contiguous
- IP ownership and traceability
- Useful for whitelisting on firewalls or third-party services
Azure NAT AVGateway randomly selects from the available public IPs in the prefix for each outbound connection.
Configuration Requirements
Prerequisites
- A Virtual Network with at least one subnet
- A Standard SKU Public IP or Public IP Prefix
- NAT Gateway resource created in the same region
Steps to Configure
- Create a Public IP or Prefix
- Create a NAT Gateway and assign the IP(s)
- Associate the NAT Gateway with a subnet
- Ensure VMs in subnet do not have their own public IPs
Once configured, all outbound internet traffic from the subnet uses the NAT Gateway.
Security Implications
- No Inbound Access: NAT Gateway does not accept incoming traffic
- Egress Control: Combine with NSGs to limit outbound access
- Traffic Logs: Use Network Watcher to monitor traffic
- IP Whitelisting: External services can safely whitelist NAT IPs
For secure application design:
- Use Private IPs for backend services
- Use NAT Gateway for outbound-only traffic
- Use Azure Firewall or Load Balancer if inbound access is needed
NAT Gateway Limits and Quotas
Resource | Limit |
Max SNAT ports per IP | 64,512 |
Max public IPs per gateway | 16 |
Max subnets per gateway | 64 |
Max NAT gateways per region | 200 (soft limit) |
These quotas can be increased by raising a support request.
Best Practices
- Use NAT Gateway with public IP prefix for easier IP whitelisting
- Never assign public IPs to VMs in subnets using NAT Gateway
- Combine NAT Gateway with NSGs for egress filtering
- Monitor port utilization with Azure Monitor or Traffic Analytics
- Ensure DNS resolution is configured properly for VMs
- Do not use Basic SKU public IPs—only Standard SKU is supported
Use Cases
- Secure Web Applications
Allow backend app servers to call external APIs without exposing them to the internet.
- Download Updates
Let VMs or containers download software updates securely and predictably.
- Hybrid Architectures
Let services in Azure connect to SaaS platforms via known IPs for access control.
- Microservices Communication
Kubernetes pods or containers in isolated subnets can use NAT Gateway for external communication.
Pricing Overview
Azure NAT Gateway pricing is based on:
- Resource usage
- A flat fee per NAT Gateway resource per hour
- Data processed
- Charges per GB of outbound data only
Note: Inbound data is always free.
You can calculate costs using the Azure Pricing Calculator.
Conclusion
Azure NAT Gateway is a highly secure, scalable, and cost-effective solution for outbound internet access from Azure virtual networks. By abstracting the complexity of managing public IPs and NAT rules, it allows organizations to focus on building applications while maintaining strong security and compliance postures.
Whether you’re building microservices, cloud-native apps, or managing VMs behind private IPs, NAT Gateway ensures consistent, controlled, and efficient outbound connectivity without compromising security.
For most production environments, NAT Gateway is the recommended solution for egress traffic, replacing older methods like instance-level public IPs or load balancer-based NAT.