The bug (in the network-manager package) is that /etc/dnsmasq.d/network-
manager contains

    except-interface=lo

despite the fact that network-manager was changed not to listen on lo's
IP address (127.0.0.1) any more.  Here's the changelog entry announcing
this change.

  network-manager (0.9.6.0-0ubuntu4) quantal; urgency=low
    * debian/patches/dns-dnsmasq-interface-and-dbus-path.patch: set the address
      dnsmasq (and bind) plugins should listen on for DNS resolution to 
127.0.1.1,
      as opposed to 127.0.0.1 to avoid conflicts with other instances that might
      need to run on the system with that address.
      [...]
   -- Mathieu Trudel-Lapierre <[email protected]>  Tue, 21 Aug 2012 
11:45:46 -0400

If the aforementioned line is commented out

    #except-interface=lo

then name service works, with the standalone dnsmasq listening on
127.0.0.1 and forwarding to 127.0.1.1.  @Submitter: please use this
workaround for now.  Assuming you want to use standalone dnsmasq,
remember to set /etc/default/dnsmasq ENABLED back to 1.

Earlier discussion of the issues at hand here: bug #959037.

** Package changed: dnsmasq (Ubuntu) => network-manager (Ubuntu)

** Summary changed:

- dnsmasq updating resolvconf when it's not configured to do DNS
+ network-manager dnsmasq configuration snippet causes standalone dnsmasq not 
to listen on 127.0.0.1, breaking name service when dnsmasq is installed

-- 
You received this bug notification because you are a member of Desktop
Packages, which is subscribed to network-manager in Ubuntu.
https://bugs.launchpad.net/bugs/1042275

Title:
  network-manager dnsmasq configuration snippet causes standalone
  dnsmasq not to listen on 127.0.0.1, breaking name service when dnsmasq
  is installed

Status in “network-manager” package in Ubuntu:
  Confirmed

Bug description:
  The system dnsmasq is preventing nameservice from working with
  NetworkManager. By setting /etc/deafault/dnsmasq ENABLED=1 to
  ENABLED=0, nameservice started working again.

  ProblemType: Bug
  DistroRelease: Ubuntu 12.10
  Package: dnsmasq (not installed)
  ProcVersionSignature: Ubuntu 3.5.0-12.12-generic 3.5.2
  Uname: Linux 3.5.0-12-generic x86_64
  ApportVersion: 2.5.1-0ubuntu2
  Architecture: amd64
  Date: Mon Aug 27 10:48:06 2012
  EcryptfsInUse: Yes
  InstallationMedia: Ubuntu 12.04 LTS "Precise Pangolin" - Release amd64 
(20120425)
  ProcEnviron:
   TERM=xterm
   PATH=(custom, user)
   LANG=en_US.UTF-8
   SHELL=/bin/bash
  SourcePackage: dnsmasq
  UpgradeStatus: No upgrade log present (probably fresh install)
  mtime.conffile..etc.default.dnsmasq: 2012-08-27T10:43:43.717591
  mtime.conffile..etc.dnsmasq.conf: 2012-05-26T23:51:39.391123

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