The vulnerability lies in the way Windows handles malformed animated cursor files and could enable a hacker to remotely take control of an infected system. The bug affects all the recent Windows releases, including its highly-touted Vista operating system. Internet Explorer is the main attack vector for the exploits.
Microsoft said in its advisory that researchers are working on a patch for the bug.
"In order for this attack to be carried out, a user must either visit a Web site that contains a Web page that is used to exploit the vulnerability, view a specially crafted e-mail message, or opening a specially crafted e-mail attachment sent to them by an attacker," Adrian Stone, a Microsoft researcher said in a blog. "While the attack appears to be targeted and not widespread, we are monitoring the issue and will update the Advisory and blog as new information becomes available."
Maarten Van Horenbeeck, a handler with the Internet Storm Center, reported on their site that they have spotted domains hosting malicious code that would exploit this vulnerability. And Craig Schmugar, a researcher at McAfee, said on his blog that McAfee analysts are seeing malicious exploit samples, as well.
"Preliminary tests demonstrate that Internet Explorer 6 and 7 running on a fully patched Windows XP SP2 are vulnerable to this attack," Schmugar wrote, adding that known exploits download and execute arbitrary .exe files. "Exploitation happens completely silently."
TrendMicro posted an advisory warning that a Trojan, named Anicmoo.ax, which is exploiting this bug, may get into a system in the form of a specially-crafted animated cursor (.ANI) file downloaded from the Internet by unsuspecting users. It may also arrive as a file embedded in HTML e-mail messages.
Microsoft said in its advisory that it has added detection to the Windows Live OneCare safety scanner for up-to-date removal of malicious software that attempts to exploit this vulnerability.