A high density network access server implements a tunneling protocol between a modem module and a route server module. PPP and routing control packets received from the PPP link are tunneled to the route server for processing. The IP data packet forwarding function for the network access server is distributed directly to the modem modules. The combination of distributed PPP processing and distributed IP data packet forwarding enables the capacity of the network access server to be scaled to orders of magnitude greater than previously known, to handle thousands or even tens of thousands of simultaneous data sessions.