A reverse proxy creates a web server on a local port that transparently proxies requests to a remote web server. All the requests and responses on the reverse proxy may be recorded in Charles.
A reverse proxy is useful if you have a client application that doesn't support the use of an HTTP proxy, or you want to avoid configuring it to use a proxy. Create a reverse proxy to the original destination web server and then connect the client application to the local port; the reverse proxy is transparent to the client application and enables you to view the traffic in Charles where you previously may not have been able to.
Read more about reverse proxies at http://en.wikipedia.org/wiki/Reverse_proxy
HTTP or HTTPS/SSL
Charles can create a reverse proxy to an HTTP or HTTPS destination. For HTTP the destination port will likely be 80, for HTTPS it will be 443. When you create an HTTPS reverse proxy you must connect to it using HTTPS, eg. https://localhost:60000/