What
A proxy is a go-between server that Claude Code can send its network traffic through. CLAUDE_CODE_PROXY_RESOLVES_HOSTS is an environment variable, a setting passed to Claude Code from your shell. It is now listed with the other proxy variables, such as HTTPS_PROXY, NO_PROXY, CLAUDE_CODE_HTTP_PROXY and CLAUDE_CODE_HTTPS_PROXY.
When it is set and your machine cannot look up a server name (the lookup fails with EAI_AGAIN or ENOTFOUND), a websocket connection, a long-lived two-way link to a server, is now left to the proxy to resolve. Before, Claude Code stopped with a "could not resolve" error. Some names are never handed over:
- names that mean your own machine (loopback)
- names that point at cloud metadata services
- names with an empty part, such as two dots in a row
Why
On networks where only the proxy can look up outside names, such as sandboxed or proxy-only setups, these connections can now go through instead of failing at the name lookup.