A honeypot is valuable as a surveillance and early-warning tool. While it is often a computer, a honeypot can take other forms, such as files or data records, or even unused IP address space. A honeypot that masquerades as an open proxy to monitor and record those using the system is a sugarcane. Honeypots should have no production value, and hence should not see any legitimate traffic or activity. Whatever they capture is therefore malicious or unauthorized. One practical implication of this is honeypots that thwart spam by masquerading as the type of systems abused by spammers. They categorize trapped material 100% accurately: it is all illicit.
Honeypots can carry risks to a network, and must be handled with care. If they are not properly walled off, an attacker can use them to break into a system.
Victim hosts are an active network counter-intrusion tool. These computers run special software, designed to appear to an intruder as being important and worth looking into. In reality, these programs are dummies, and their patterns are constructed specifically to foster interest in attackers. The software installed on, and run by, victim hosts is dual purpose. First, these dummy programs keep a network intruder occupied looking for valuable information where none exists, effectively convincing him or her to isolate themselves in what is truly an unimportant part of the network. This decoy strategy is designed to keep an intruder from getting bored and heading into truly security-critical systems. The second part of the victim host strategy is intelligence gathering. Once an intruder has broken into the victim host, the machine or a network administrator can examine the intrusion methods used by the intruder. This intelligence can be used to build specific countermeasures to intrusion techniques, making truly important systems on the network less vulnerable to intrusion.

Honeypots can be classified based on their deployment and based on their level of involvement. Based on the deployment, honeypots may be classified as
- Production Honeypots
- Research Honeypots
Production honeypots are easy to use, capture only limited information, and are used primarily by companies or corporations; Production honeypots are placed inside the production network with other production servers by organization to improve their overall state of security. Normally, production honeypots are low-interaction honeypots, which are easier to deploy. They give less information about the attacks or attackers than research honeypots do. The purpose of a production honeypot is to help mitigate risk in an organization. The honeypot adds value to the security measures of an organization.
Research honeypots are run by a volunteer, non-profit research organization or an educational institution to gather information about the motives and tactics of the Blackhat community targeting different networks. These honeypots do not add direct value to a specific organization. Instead they are used to research the threats organizations face, and to learn how to better protect against those threats. This information is then used to protect against those threats. Research honeypots are complex to deploy and maintain, capture extensive information, and are used primarily by research, military, or government organizations.
This information is taken from Wikipedia.org
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Honeypot manual
I found an Honeypot manual (PDF) that explains how to build an Honeypot. I am going to build one at my Internship.
I will be using an Windows 2003 server. Single core processor and 512mb ram.
Honeypot
Is that enough to build a Honeypot? Becouse i want to try it on my Internship too. But I don`t have another computer, so i have to do it with in a virtulbox.
ISO
What you can do is ready the server in a virtual machine. Using Microsoft Virtual Machine or something. And then configure the server and burn it to an iso disk.
At the moment that you got a computer you can put the iso on it.
I would not work in a virtual environment because then the server will be on the network. And you want the honeypot to be on an other network.
Because the hacker will search for the most vulnerable machine to attack. And the honeypot is that vulnerable machine.
Honeypot
So i have to use an old computer that i don`t use anymore? just to install the server on it. That would be easy if i had another computer.
Thanx. peace out
Honeypot
Yes, I'm a beginner and I would do it first on a old computer and when it works i would create another one. But then on a stronger computer.
All we want to do with a honeypot is to attract hackers to the honeypot. So they will leave the "real" computers alone.