I tried using that guide: https://powerautomate.microsoft.com/en-us/blog/on-premise-apis/

To work with my localhost running server with azure custom connector.

I've defined an API gateway and my local server is running but receiving:

    {
      "error": {
        "code": 500,
        "message": "No connection could be made because the target machine actively refused it 127.0.0.1:8000",
        "source": "unitedstates-002.azure-apim.net",
        "path": "forward-request",
        "policyId": "",
        "clientRequestId": "70655628-faaa-4725-8ea1-4b8a-e599385d"
      }
    }

When testing my connector.

My local server is at: http://127.0.0.1:8000

My gateway:

My custom connector connection creation:

My connector gateway settings:

Note that:

This is power automate custom connector.

The Only diff is that I'm using the url from apiProperties.json file "x-ms-apimTemplateParameter.urlTemplate": "http://127.0.0.1:8000"

If I'm using localhost in the swagger host everything is fine.