Are Terraform providers always installed from the Internet?

Terraform providers are not always installed from the Internet, making the assertion that they are always sourced online incorrect. Terraform has a mechanism that allows providers to be installed locally or retrieved from local file paths. This means that if a provider is downloaded beforehand or is already present in the local environment, Terraform can use that local copy without needing to access the Internet.

Furthermore, users can also specify the source of providers in an offline mode by referring to a local directory or hosting their own providers. This is particularly useful in scenarios where a stable version of a provider is needed, or when working in controlled environments with restricted Internet access.

The other options suggest that providers must either always come from specific conditions or sources, which does not account for the flexibility Terraform provides in terms of managing provider installations. Thus, it is clear that the installation of Terraform providers can happen from local sources, affirming that the correct response to the question is that providers are not always installed from the Internet.