Charles is an HTTP proxy / HTTP monitor / Reverse Proxy that enables a developer to view all of the HTTP traffic between their machine and the Internet. This includes requests, responses and the HTTP headers (which contain the cookies and caching information).
Charles can act as a man-in-the-middle for HTTP/SSL communication, enabling you to debug the content of your HTTPS sessions.
Charles simulates modem speeds by effectively throttling your bandwidth and introducing latency, so that you can experience an entire website as a modem user might (bandwidth simulator).
Charles is especially useful for Macromedia Flash developers a you can view the contents of LoadVariables, LoadMovie and XML loads.