Notable IP addresses / 127.0.0.1
The IPv4 loopback address. Traffic sent to 127.0.0.1 never leaves your device; it is how programs on the same machine talk to each other.
The whole 127.0.0.0/8 block is reserved for loopback, but 127.0.0.1 is the address everyone uses, mapped to the hostname "localhost". Web developers run local servers on it (http://127.0.0.1:3000, :8080, :5173), databases listen on it, and blocking a domain in the hosts file means pointing it at 127.0.0.1.
The IPv6 equivalent is ::1. If a service listens on 127.0.0.1 it is only reachable from the same machine; to accept connections from other devices it must bind to 0.0.0.0 or a LAN address.
In practice yes: the hosts file maps localhost to 127.0.0.1 (and ::1). Some tools treat them differently when IPv6 is preferred, which explains the occasional "works on 127.0.0.1 but not localhost" bug.
Not directly — loopback traffic never crosses the network interface. Malware already on the machine can reach local services, which is why local admin panels should still require authentication.