diff --git a/.github/upstream-projects.yaml b/.github/upstream-projects.yaml
index 2a2bace0..4001ede3 100644
--- a/.github/upstream-projects.yaml
+++ b/.github/upstream-projects.yaml
@@ -113,7 +113,7 @@ projects:
 
   - id: toolhive-studio
     repo: stacklok/toolhive-studio
-    version: v0.37.0
+    version: v0.38.0
     docs_paths:
       - docs/toolhive/guides-ui
 
diff --git a/docs/toolhive/guides-ui/configure-mcp-servers.mdx b/docs/toolhive/guides-ui/configure-mcp-servers.mdx
index 7b2d6e90..590d7121 100644
--- a/docs/toolhive/guides-ui/configure-mcp-servers.mdx
+++ b/docs/toolhive/guides-ui/configure-mcp-servers.mdx
@@ -2,7 +2,7 @@
 title: Configure MCP servers
 description:
   Configure MCP server settings in the ToolHive UI, including names, groups,
-  ports, secrets, storage volumes, network isolation, and remote authentication.
+  ports, secrets, storage volumes, network access, and remote authentication.
 ---
 
 When you install an MCP server in the ToolHive UI, the configuration form
@@ -126,10 +126,12 @@ form.
 This applies to both registry-installed servers and custom servers (Docker image
 or source package).
 
-### Network isolation
+### Network access
 
-Restrict the MCP server's network access. This enhances security by limiting the
-server's ability to communicate with external networks. See the
+Choose how the MCP server reaches the network. ToolHive enables network
+isolation by default, routing outbound traffic through an HTTP proxy that
+restricts it to the destinations you allow. The **Network access** tab lets you
+keep this proxy, allow unrestricted access, or share the host network. See the
 [Network isolation](./network-isolation.mdx) guide for details.
 
 ## Options for remote servers
diff --git a/docs/toolhive/guides-ui/network-isolation.mdx b/docs/toolhive/guides-ui/network-isolation.mdx
index 81884d5c..1503c978 100644
--- a/docs/toolhive/guides-ui/network-isolation.mdx
+++ b/docs/toolhive/guides-ui/network-isolation.mdx
@@ -11,14 +11,19 @@ access APIs, download data, or communicate with other services. However,
 malicious or misconfigured servers can also exfiltrate sensitive data or
 download unwanted content.
 
-When you install an MCP server in ToolHive, you can optionally enable _network
-isolation_. This feature restricts the MCP server's network access to only the
-resources you specify.
+When you install an MCP server in ToolHive, you choose how the server reaches
+the network. _Network isolation_ routes the server's outbound HTTP and HTTPS
+traffic through an egress proxy that restricts it to the destinations you allow.
+
+By default, ToolHive enables network isolation for local MCP servers, matching
+the ToolHive CLI. New servers start behind the HTTP proxy, and you can relax or
+tighten this from the **Network access** tab as described below.
 
 :::note
 
-Network isolation currently supports HTTP and HTTPS connections only. Other
-protocols are not supported.
+Network isolation supports HTTP and HTTPS connections only. Other protocols are
+not filtered by the proxy; use **No isolation** or **Host networking** if your
+server needs raw TCP or a non-HTTP protocol.
 
 :::
 
@@ -34,19 +39,43 @@ hardcoded connections).
 
 :::
 
-## Enabling network isolation
+## Configuring network access
+
+Network access modes are available for local MCP servers installed from the
+registry or custom servers. They do not apply to remote MCP servers, which are
+hosted and reached over the internet outside of ToolHive's control.
+
+During the MCP server installation, select the **Network access** tab in the
+configuration form and choose one of three modes:
+
+- **No isolation**: the server has unrestricted outbound network access. Use
+  this for trusted servers or when your server needs a protocol other than HTTP
+  or HTTPS.
+- **Host networking (Advanced)**: the server's container shares the host
+  machine's network namespace directly. No egress filtering is applied. Use this
+  only when you understand the security implications.
+- **Isolate behind an HTTP proxy**: the server's outbound HTTP and HTTPS traffic
+  is routed through ToolHive's egress proxy, which only forwards connections to
+  the destinations you allow.
+
+Both registry and custom servers default to **Isolate behind an HTTP proxy**,
+because ToolHive enables network isolation by default. Registry servers pre-load
+any allowed destinations declared in their registry entry. To give a server
+unrestricted network access, switch to **No isolation**.
 
-Network isolation is available for local MCP servers installed from the registry
-or custom servers. It is not available for remote MCP servers, which are hosted
-and outside of ToolHive.
+### Restricting proxied traffic
 
-During the MCP server installation, select the **Network isolation** tab in the
-configuration form. Click the toggle to enable it.
+When you choose **Isolate behind an HTTP proxy**, the **Allowed destinations**
+options appear:
 
-When you enable network isolation, any safe default configuration defined in the
-registry is pre-loaded in the form. You can accept these defaults or customize
-the settings to specify which hosts and ports the MCP server is allowed to
-access:
+- **Anywhere**: allow HTTP and HTTPS traffic to any destination.
+- **Selected destinations**: only allow the specific hosts and ports you list
+  below.
+
+When you choose **Selected destinations**, any safe defaults defined by the
+registry entry are pre-loaded in the form. You can accept these defaults or
+customize the settings to specify which hosts and ports the MCP server is
+allowed to access:
 
 - **Allowed hosts**:\
   A list of hostnames or IP addresses that the MCP server is allowed to access.
@@ -69,18 +98,33 @@ access:
 
 :::info[Important]
 
-If you do not specify any allowed hosts or ports, the MCP server will not be
-able to access any external resources, including the internet. This can be
+If you choose **Selected destinations** but leave both allowed hosts and allowed
+ports empty, the MCP server cannot reach any external resources. This can be
 useful for MCP servers that do not require network access or for testing
-purposes.
+purposes; the form displays a warning in this case.
 
 :::
 
+### Allowing host machine access
+
+When a server runs behind the HTTP proxy, ToolHive blocks connections to Docker
+gateway addresses (`host.docker.internal`, `gateway.docker.internal`, and the
+Docker bridge gateway IP) by default, even when you allow all destinations.
+Reaching the host machine is a separate, more privileged opt-in.
+
+Enable **Allow host machine access** to let the server connect to these gateway
+addresses. Turn this on when your MCP server needs to reach a service running on
+your host machine, such as a database or a local development server.
+
+Host machine access is port-independent: once enabled, the gateway is reachable
+on any port, regardless of the allowed ports you list. You don't need to add the
+gateway hostname to the allowed hosts.
+
 ## Example configuration
 
-The configuration pictured below allows the MCP server to access
-`api.github.com` and all subdomains of `githubusercontent.com` on port 443
-(HTTPS):
+With **Isolate behind an HTTP proxy** and **Selected destinations** chosen, the
+configuration pictured below allows the MCP server to access `api.github.com`
+and all subdomains of `githubusercontent.com` on port 443 (HTTPS):
 
 <ThemedImage
   alt='Network isolation configuration showing allowed hosts and ports'
@@ -94,19 +138,19 @@ The configuration pictured below allows the MCP server to access
 
 ### Accessing other workloads on the same container network
 
-To allow an MCP server to access other workloads on the same network, you need
-to configure network isolation to include the appropriate hostnames and ports.
-This is commonly needed when your MCP server needs to communicate with
-databases, APIs, or other services that are running on your local host during
-development.
+MCP servers often need to reach services running elsewhere during development,
+such as databases, APIs, or other local servers.
 
-For example, in Docker environments, you can add `host.docker.internal` to
-access services on the host. `host.docker.internal` is a special hostname
-provided by Docker that resolves to the host machine's IP address from within
-containers.
+To reach a service on your **host machine**, enable
+[**Allow host machine access**](#allowing-host-machine-access). The server can
+then connect to `host.docker.internal` (on macOS and Windows) or the Docker
+bridge gateway IP (typically `172.17.0.1` on Linux) on any port. Because these
+gateway addresses are blocked by default, adding them to the allowed hosts list
+alone is not enough; you must enable this option.
 
-- **Allowed hosts**: `host.docker.internal`
-- **Allowed ports**: `3000`
+To reach a service that is **not** on the host machine, add its hostname and
+port to the allowed hosts and ports under **Selected destinations**, as
+described in [Restricting proxied traffic](#restricting-proxied-traffic).
 
 ## Next steps
 
@@ -126,10 +170,14 @@ containers.
 <details>
 <summary>MCP server can't reach an external service</summary>
 
-1. Check your allowed hosts and ports. Open the server's settings and confirm
-   the hostname and port the server needs are listed. Network isolation only
-   supports HTTP and HTTPS, so direct TCP connections (databases, custom
-   protocols) won't work.
+1. Check the network access mode and allowed destinations. Open the server's
+   settings, select the **Network access** tab, and confirm the mode is
+   appropriate for the server. If the server is set to **Isolate behind an HTTP
+   proxy** with **Selected destinations**, confirm the hostname and port the
+   server needs are listed. If the server needs to reach a service on your host
+   machine, make sure **Allow host machine access** is enabled. Proxied network
+   isolation only supports HTTP and HTTPS, so direct TCP connections (databases,
+   custom protocols) won't work in this mode.
 
 2. Check the server logs from the **MCP servers** page. Select the server, open
    the logs panel, and look for connection errors or denied requests.