A client that uses an object across any kind of a remoting boundary is actually using a transparent proxy for the object. The transparent proxy gives the impression that the actual object resides in the client's space. It achieves this by forwarding calls made on it to the real object using the remoting infrastructure.

The transparent proxy is itself housed by an instance of a managed runtime class of type System.Runtime.Remoting.Proxies.RealProxy. The System.Runtime.Remoting.Proxies.RealProxy implements a part of the functionality needed to forward the operations from the transparent proxy. A proxy object inherits the associated semantics of managed objects such as garbage collection, support for members and methods, and can be extended to form new classes. Thus the proxy has a dual nature; on the one hand it needs to act as an object of the same class as the remote object (transparent proxy), and on the other it is a managed object itself.

A proxy object can be used without regard to any remoting subdivisions within a AppDomain. Applications need not distinguish between proxy references and object references. However, service providers dealing with issues such as activation, lifetime management, and transactions need to make such distinctions.