Fighting Against Spyware & Malware
Spyware is software that enables a third-party to track where you go on the Internet. Usually this does not involves specific tracking cookies and companies that specialize in tracking your visits to advertiser sites.
Although this capability has given cookies a bad name, cookies are not inherently evil. They are used for many good purposes such as automatically logging you into a site like My Yahoo! or the New York Times. Most sites do not use cookies to spy on you.
Spyware, on the other hand, is almost always software that is actually installed on your computer — without your knowledge, usually, to monitor and report on what you do. It may be for the purpose of giving you specific advertising. More often, it is designed to steal personal information such as user IDs and passwords or credit card numbers.
Adware is software that generates ads, especially popup ads, to interfere with your computing and Internet surfing experience.
As most people use the term “adware,” and I agree with them, “adware” does not include software that displays unobtrusive ads with your conscious agreement (not buried deep in a license agreement or installed without your agreement) as a way to provide free software for you.
Examples of this latter “non-adware” case are Eudora (email) and Opera (web browser), both of which give you the option to purchase versions without advertising and have ad-sponsored versions available as free alternatives.
Malware is a more generic term to mean any program that is designed to abuse your computer system or trust. Spyware and Adware are in this category, as are Browser Hijackers, Trojans, Viruses and Worms.
Read more in Fighting Against Spyware & Malware