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They're lurking out there--sleazy spyware companies, unscrupulous advertisers, and just people you don't want looking at what your computer is doing. PeerBlock (free), an open source program, offers part of a solution--low level blocking of packets coming from, or going to, a long list of hosts.
While any decent firewall program will let you block hosts one by one, PeerBlock does a huge amount of the work for you, by providing several frequently-updated lists of host addresses. These are divided into spyware, advertising, education, and peer-to-peer. Those last two might raise some eyebrows. The "Education" list is primarily aimed at those using college networks, who do not want their college monitoring their activity. The "P2P" list is a collection of media companies, who regularly scan people on file sharing networks to find out who is pirating movies and music. While there are often legitimate reasons to want to have such protection, it should be noted that PeerBlock freely admits it doesn't provide total security--and if you are violating your college's or ISP's terms of Internet usage, or engaging in illegal activity, this program (or any similar tool) is not going to keep you safe.
Getting the most out of PeerBlock requires a little bit of technical savvy. Simply letting it run with everything cranked to the max caused me to have quite a few problems with Web sites; many hung due to being unable to talk to many of the advertisers on the site. There is a convenient option to allow any communication on the HTTP ports through, however. Depending on how your computer connects to the Internet and the settings of your firewall and ISP, you may need to tweak some things. Fortunately, PeerBlock has a clean and easy-to-understand interface, as well as a public forum.
It is easy to add new blocklists, or to unblock a particular range of addresses for a short period, or forever.
How much use PeerBlock is to you depends on your security needs and your level of paranoia, justified or otherwise. It is a useful first line of defense against sharing information with people you don't want to share information with, but it's not absolute, and the size and scope of the lists could cause some surprises or odd behavior, especially if you forget that it's running. I would consider it generally worth trying, if only for the experience of seeing just how many sites are trying to talk to your computer during an average browsing session.