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You should check the The Security FAQ of this site for more information on security, and how to secure your home computer.
NAT offers good security, because by its nature it does not allow incoming connections, it is for sharing an IP address amongst several computers for outgoing purposes only.
Apart from NAT, basic security is to have a router with firewall features, that only allows in what you decide to allow in. Your DSL connection options usually include the choice of a router. Although not strictly speaking a full firewall, a router is the first line of defense against intruders. With the modern router, setup correctly and refusing to route any requests by outside IP addresses for inside resources, things are a little tough for the hacker. However, you may want to open things up a little more, for example to allow yourself to telnet into your own computer from other places, run an FTP service, or your own web server. In this case, you need to look carefully at (a) the security setup for anything that is "public", (b) encrypting any files you really care about, and (c) avoiding transmission of any passwords in plaintext form.
If you are doing anything serious with your DSL connected equipment, it is also a good idea to look at getting or writing some kind of small monitoring system that will play cop inside your own network.. like a ignition cutout on a car, these can be simple, yet very unobtrusive.
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