Proxy server Blocking Internet access
Open the Internet Connection Properties
Go to Control Panel - Internet Options
Navigate to the Proxy Settings
Click the Connections tab and the LAN Settings button.
Check the box labeled "Use a proxy server for your LAN".
Set the Proxy to an unavailable address
I generally use 127.0.0.1 as the address as most workstations do not have a service running to respond to internet requests. If you stop here, all internet access for that workstation will be blocked.
Add Exceptions (Optional)
If you click the Advanced button, you can add exceptions to the proxy rules. Adding these will allow this workstation to route internet traffic the regular way for those specific sites. Add these sites to the exceptions box. An example could be: mail.yourcompany.com;www.yourcompany.com;www.spiceworks.com
Use semicolons (;) and no spaces to separate. Do not include http or https.
This box will define subdomains or assume they are all valid if you do not include them. For example, adding yourcompany.com will include both mail.yourcompany.com and www.yourcompany.com.