Understanding http proxies

[Olive]

I am trying to understand how to build an http proxy server in python,
and I have found the following example:

http://www.oki-osk.jp/esc/python/proxy/

But I do not have found an exact description of what exactly a proxy
server is suppose to do (all references gice only the basic principe of
proxy that I know). In the following model

Client <-> Proxy <-> Server

it seems when I read the code above that the proxy acts mostly as an
orinary server with respect to the client except that it is supposed to
receive the full URL instead of just the path. Am I right? Is there any
documentation on what an http proxy is supposed to implement.

Olive