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Layer 4 load balancers look at info at the [transport layer](#communication) to decide how to distribute requests. Generally, this involves the source, destination IP addresses, and ports in the header, but not the contents of the packet. Layer 4 load balancers forward network packets to and from the upstream server, performing [Network Address Translation (NAT)](https://www.nginx.com/resources/glossary/layer-4-load-balancing/).
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Layer 7 load balancers look at the [application layer](#communication) to decide how to distribute requests. This can involve contents of the header, message, and cookies. Layer 7 load balancers terminates network traffic, reads the message, makes a load-balancing decision, then opens a connection to the selected server. For example, a layer 7 load balancer can direct video traffic to servers that host videos while directing more sensitive user billing traffic to security-hardened servers.
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Sergey Saiyan