Cisco ASA and PIX Firewall Handbook

6-1. Transparent Firewall Mode

Traditionally, Cisco firewalls have operated by performing Layer 3 (IP address) operations. Naturally, the stateful inspection process can look at higher layers within the IP packets being examined. But the firewall itself has maintained its own interface IP addresses and acted as a router or gateway to the networks that connect to it. This is called routed firewall mode.

Beginning with PIX 7.0 and FWSM 2.2(1), a Cisco firewall can be configured to operate in transparent firewall mode. The firewall appears to operate as a Layer 2 device without becoming a router hop or a gateway to the connected networks. This is also known as a Layer 2 firewall or a stealth firewall, because its interfaces have no IP addresses ...