By default Moodle uses the free online NetGeo (The Internet Geographic Database) server to lookup location of IP addresses, unfortunately this database is not maintained anymore and may return <em>wildly incorrect</em> data.
It is recommended to install local copy of free GeoLite City database from MaxMind.<br />
IP address location is displayed on simple map or using Google Maps. Please note that you need to have a Google account and apply for free Google Maps API key to enable interactive maps.