http://www.ubuntuforums.org/showthread.php?t=91370

Note: Type all the following commands in a root terminal, DO NOT use sudo.

1. Start by configuring the network card that interfaces to the other computers on you network:

# ifconfig ethX ip

where ethX is the network card and ip is your desired server ip address (Usually 192.168.0.1 is used)

2. Then configure the NAT as follows:

# iptables -t nat -A POSTROUTING -o ethX -j MASQUERADE

where ethX is the network card that the Internet is coming from

# echo 1 > /proc/sys/net/ipv4/ip_forward

3. Install dnsmasq and ipmasq using apt-get:

# apt-get install dnsmasq ipmasq

4. Restart dnsmasq:

# /etc/init.d/dnsmasq restart

5. Reconfigure ipmasq to start after networking has been started:

# dpkg-reconfigure ipmasq

6. Repeat steps 1 and 2.

7. Add the line “net.ipv4.ip_forward = 1” to /etc/sysctl.conf

# gedit /etc/sysctl.conf

8. Reboot. (Optional)

I hope this helps.

Good luck!