(Part of the detailed Step-by-Step Installation Guide for setting up the Server)

sudo apt-get install squid

Configure Squid for Transparent Proxy:

sudo vi /etc/squid/squid.conf

http_port 192.168.1.1:3128 transparent
icp_port 0
always_direct allow all
acl our_networks src 192.168.1.0/24 192.168.2.0/24
http_access allow our_networks

sudo /etc/init.d/squid restart

Configure Firewall for Transparent Proxy:

sudo vi /etc/shorewall/rules

REDIRECT loc 3128 tcp www - !192.168.1.1

sudo /etc/init.d/shorewall restart

Advert blocking:

A simple hosts file serves pages faster than DansGuardian

wget http://www.mvps.org/winhelp2002/hosts.zip
unzip hosts.zip
sed '/127.0.0.1 / s/127.0.0.1 //g' HOSTS > adservers
vi adservers

# Delete all the top comments & the line 'localhost'

sudo mv adservers /etc/squid 

sudo vi /etc/squid/squid.conf

acl ads dstdomain "/etc/squid/adservers"
http_access deny ads

sudo /etc/init.d/squid restart

Add SARG for log analysis:

sudo apt-get install sarg

Continue with the rest of the detailed Step-by-Step Installation Guide