SQL Server Proxy is a named holder of SQL Server Credentials.
SQL Server Proxies are basically used to definte the security context of a job step.
These proxies provide the job with the security credentials that were defined by the proxy.
The sql server agent first imporsinates the security credentials of the proxy and then runs the job step.

For example if there are two sql servers, server A and the other server B.
There is a requirement where in one step in the agent job on server A has to access the data from one of the tables in server B.
Let us suppose X has read permissions on server B.
Now in order to give the Job step permission on server B the following steps are performed on server A:

  • New Credential for X is created (i.e Identity and password are saved)
  • New Proxy is created using the credential created above.
  • The proxy is mapped with the subsystem as required.(this depends on what the job step does)
  • The job step is modified to use this proxy.

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