An IoT gateway is a physical device or software program that serves as the connection point between the cloud and internet of things devices, such as controllers, sensors and smart devices.
IoT is used in enterprises and industries and can be found in consumer products. IoT gateways act as a central hub, connecting IoT devices to the cloud. Organizations can use gateways to connect IoT devices for data processing and to monitor and manage IoT devices.
All data moving between IoT-connected devices and the cloud passes through an IoT gateway, which can be either a dedicated hardware appliance or an application. An IoT gateway might also be referred to as an intelligent gateway or control tier.
While IoT gateways enable communication between IoT devices and systems, they can also reduce latency and facilitate IoT deployments at scale.
What does an IoT gateway do?
An IoT gateway acts as a network router, routing data between IoT devices and the cloud. Early on, most gateway devices only sent traffic in one direction: from the IoT device to the cloud. Now, it is common for gateway devices to handle both inbound and outbound traffic. Outbound traffic streams are used to send IoT data to the cloud, while inbound traffic is used for device management tasks, such as updating firmware.
Some IoT gateways do more than route traffic. They can also preprocess data locally at the edge before sending it to the cloud. In doing so, the device might deduplicate, summarize or aggregate data to reduce the volume of data that is then forwarded to the cloud. This can improve response times and reduce network transmission costs.
IoT gateways include the following potential applications:
- Improve security. IoT gateways act as a point where security measures, such as device authentication and intrusion detection, can be applied.
- Manage devices. IoT gateways act as touchpoints that enable device management and configurations.
- Support edge computing. IoT gateways support the preprocessing of data before it is sent to the cloud.
- Translate protocols. IoT gateways convert different communication protocols used by separate IoT devices.
- Support industry-specific applications. These include the following applications and vertical markets:
- Smart homes.
- Industrial automation.
- Healthcare.
- Agriculture.
- Transportation.
How does an IoT gateway work?
A simple IoT gateway functions like a Wi-Fi router. An IoT system connects to the gateway using a Wi-Fi connection, and the gateway routes the IoT device data to the cloud. More often, though, IoT gateways are far more complex.
Still, the simplified process of IoT data traveling across an IoT gateway looks like the following:
- The IoT gateway receives data from a network of sensors.
- It preprocesses the data.
- That data is then converted from the device-specific format to a standardized communication protocol.
- The processed and converted data is sent to the cloud platform.
IoT architecture is divided into four layers:
- The sensor layer is where IoT devices operate.
- The network or data acquisition layer is where data is aggregated from multiple sources and is securely sent to processing systems.
- The data preprocessing layer is where basic data analytics are done to reduce data volume.
- The cloud analysis or application layer is where more in-depth data analytics is performed.
One reason why an IoT gateway tends to be more complex than a Wi-Fi router is that IoT devices use several different protocols. These protocols include Z-Wave, BACnet, Bluetooth Low Energy and Zigbee. As such, an IoT gateway might need to support a variety of protocols to service all the IoT devices in an organization.
In addition to supporting these protocols, the gateway must be able to route each type of IoT traffic to the appropriate destination. Data from a collection of industrial sensors might need to be sent to a database in the Amazon Web Services cloud, whereas data from building security sensors might need to be directed to a software-as-a-service vendor that operates a cloud-based security portal.
Another reason why IoT gateways can be more complex than Wi-Fi routers is that IoT gateways might need to cache data locally in case internet connectivity fails or the gateway is flooded with more data than it can handle.
Additionally, IoT gateways often support failover clustering, or the ability to scale out to support increasingly large workloads.
Types of IoT gateways
IoT gateways can be used in the following ways, based on their communication technologies, intended use and features:
- Industrial gateways. These IoT gateways are used in harsh industrial settings for connecting sensors, machines and other devices to data servers or the cloud.
- LoRaWAN. These IoT gateways are used in LoRaWAN networks to transfer long‑range and low-power radio messages from remote sensors to a network server.
- Cellular. These gateways use LTE (Long-Term Evolution), 4G and 5G in wide‑area carrier environments, connecting to two different internet service providers.
- Edge computing. These gateways perform local data processing, which can help organizations reduce latency and bandwidth usage.
Benefits and challenges of IoT gateways
IoT gateways provide the following benefits:
- Cost. IoT gateways can help reduce operational costs by processing data closer to the edge and reducing requirements for data transmissions.
- Data and device management. Data processed and translated at the edge means less processing needs to be done on it in the cloud, and IoT devices can have data transferred to it, meaning they can be managed and updated as needed.
- Protocol handling. IoT gateways can translate between different communication protocols, enabling devices with different protocols to be used.
- Preprocessing. Data can be processed closer to the edge before it is sent to the cloud.
IoT gateways also come with the following challenges, which can complicate their adoption:
- Production of large amounts of data by some IoT devices. This can be a problem if an organization has a significant number of devices in its IoT ecosystem and tries to send the data from all those devices to the cloud. The IoT devices could potentially deplete the organization’s available internet bandwidth, while also incurring large cloud storage costs.
- Attack surface risks. IoT also comes with some security risks, as it increases an organization’s attack surface.
- Security. Although they are improving, IoT devices can be insecure. According to the “2025 SonicWall Cyber Threat Report,” IoT security breaches increased by 124% in 2024 compared to 2023.
- Compatibility. Organizations should make sure the IoT gateway supports translating the correct protocols used by their IoT devices.
How to improve IoT gateway security
One way to avoid the problems associated with the amount of data IoT devices produce is to use edge computing for some of the required data processing. This approach minimizes the volume of data that must be sent to the cloud, thereby reducing both costs and bandwidth consumption.
Imagine that an organization has a collection of IP-enabled security cameras, all streaming real-time data. It doesn’t make sense to send all the raw security footage to the cloud for data processing, especially if some of the cameras primarily monitor unoccupied areas.
Rather than uploading all security footage in real time, it is more efficient to process the video footage at the edge. The edge device can differentiate between security footage that isn’t important, such as video of an empty room, and footage that the organization deems worthy of retention. The edge device can take the footage that must be reviewed and send it to a gateway device, which uploads the data to the cloud.
Processing IoT data on edge devices — the same process that reduces the volume of data sent to the cloud — also means the amount of data sent through the gateway is limited. This helps to reduce attack surfaces, thereby helping to improve security.
IoT gateways should sit between IoT devices and the internet and have integrated security functions. These functions, such as tamper detection, encryption and hardware random number generation, should protect the IoT devices from being attacked. For example, unidirectional gateways can protect legacy devices that cannot be secured remotely by only allowing data to move in one direction. Likewise, gateway filtering technology can monitor, manage and secure data transfers through authenticated traffic using packet filtering or physical network signal filtering.
To further improve IoT gateway security, organizations can do the following:
- Use only authenticated IoT gateways.
- Perform security assessments before implementation.
- Keep gateway software current.
- Regularly review gateway access.
- Include gateways in security audits.
- Use a separate network for IoT gateways and devices.
IoT gateways are important for managing and securing IoT devices. They might also help an organization reduce its IoT-related internet bandwidth consumption.
