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Create a private network with the same or similar domain name

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yes

gdeangelis

You can use mydomain.com. Companies do this all the time. Your site should be protected from the internet and in a dmz. This is assuming you are not using the website's server for authentication-a/d for your internal domain. That would not be advisable.
You won't have any problems with name resolution, because that is done externally through the company hosting your records on the outside, so to speak. Internally, your server, if on the same domain, would have its own internal host record, independent of the external dns.