The disclosure relates to a method executed in a domain name system (DNS) proxy, and to a DNS proxy, apparatus or system for application server (AS) discovery for edge computing in a mobile network. The method comprises receiving a DNS query from a user equipment (UE) with an application fully qualified domain name (FQDN). Based on FQDN, retrieving a location of the UE that sent the DNS query; adding subnet(s) or full IP address(es) of one or more preferred location for accessing to a data network (DN) as one or more Extension mechanisms for DNS (EDNS) client subnet (ECS) options in the DNS query; forwarding the DNS query to a mobile network operator (MNO) DNS; receiving a DNS response and based on the DNS response determining an AS site and AS IP address(es); requesting traffic steering and sending the DNS response to the UE.