There's no place like 127.0.0.1

What is 127.0.0.1?

It is a loopback IP address or a localhost address. Loopback IP addresses are those addresses that turn back the outgoing signal to the same computer so the attack will be on the same computer. Loopback IP address doesn't let your computer to communicate with other devices. The loopback address is used by users computer. Suppose a web server is running on a local machine, you can access the web pages on the local server by pointing to the loopback address (127.0.0.1). Basically, it is a local address of a computer you are in front of. Loopback IP addresses do not belong to any private IP addresses which are defined in IPV4. If you ping this address(127.0.0.1) it always returns reply until the firewall does some action to prevent it.

Why hacker says "There's no place like 127.0.0.1"?

As we all know that, any hack attack on other networks without their permission is illegal and the hackers who do such attacks we call them black hat hackers. If ethical hacker or pentester want to test their skills or techniques they use localhost which is legal i.e they do not need to take permissions from anyone. It is like you are attacking on your own computer, Ethical hackers and Pentester do their attacks on localhost because it is safe like home. As we all say there's no place like home exactly the same there's no place like 127.0.0.1.