Internet sharing dropping connection

Hey all!
Since installing the 10.7.4 update, my internet sharing on my iMac keeps dropping. It was rock-solid with 10.7.3.
The Wi-Fi indicator always shows on. And occasionally everything works fine-- for a short period of time and then the signal drops again. A reset of anything in the chain (router, iMac Wi-Fi off/on, iPhone Wi-Fi off/on) brings it on again-- temporarily. So, everything seems to function properly for a short time and then the signal is lost. And it will spontaneously come back on at any given time.
Any ideas where to go from here? I'm sure someone will suggest reverting to 10.7.3 which I might consider but I would rather it work properly.
THANKS in advance!!

system info is in my signature

Why are you using Internet Connection Sharing? Just have the devices connect to the WIFI instead of having the iMac share its connection?

Deckyon said:

Why are you using Internet Connection Sharing? Just have the devices connect to the WIFI instead of having the iMac share its connection?

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Thanks for your reply Deckyon~
I don't have a wireless router. The iMac is hardwire connected via Ethernet and the router only has 1 connection.

That is key information...

I would actually suggest you spend the $30 for a Wireless Router.

Deckyon said:

That is key information...

I would actually suggest you spend the $30 for a Wireless Router.

Click to expand...

That would be key information if I was looking for a workaround. I'm looking for my state-of-the-art Mac desktop to work like it's supposed to without introducing extraneous equipment. One of the reasons I've owned Mac for 10 years now is because it actually works like it should. Until now, that is.

The key info you left out in the very first post was you only had a non-wifi router with only one wired port.

Still doesn't change my recommendation. You are not going to get the security from shared internet connections that you will from a wireless router. And for me, personally, the frustration of dealing with shared internet connections is worth the $30.

For anybody else having this problem, it's now a known issue and is being looked at by Apple: https://discussions.apple.com/thread/3940663?tstart=0

Related

I'm using my Mac in a similar situation to physically extend my network:
Verizon --> Stupidly high performance enterprise AP --long shot--> Mac Mini Wifi --> Internet Connection Sharing --> Mac Mini Ethernet --> long cable --> Time Machine --> Me

My Mac Mini is also the failing point, so my quickest fix so far is to have two SSIDs: internet down --> share screen to mac mini --> switch SSID in ~10 seconds --> internet up

However, I get double or triple NAT, since I can't figure out how to disable NAT translation and assign an alternate DNS server on the Mac Mini via terminal or config files.