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I have tried the following from the command line in solaris:

 DATE TIME user@host> bash
 bash-3.2$ export http_proxy=http://localhost:8080/
 bash-3.2$ echo $http_proxy
 bash-3.2$ firefox

Since I do not have a proxy running on localhost firefox should not be able to reach any website, however it acts as if no proxy is set. I looked in preferences and use system proxy settings is checked, but there is no localhost:8080 filled in. What am I doing wrong?

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Firefox won't use that environmental variable unless you first install the Environmental Proxy extension -- then it'll honor that variable just fine.

See also this quesion on AskUbuntu for more detailed information.

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Then where does firefox get its "Use system proxy settings" from? – user974896 Oct 18 '12 at 15:14
Depends on your environment. If you are running under Gnome it will get them from "gconf" (try gconf-editor and look in /system/proxy). – chutz Oct 18 '12 at 16:23

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