What is Hacking?
One who breaks security on a system. Coined ca. 1985 by hackers in defense against journalistic misuse of hacker (q.v., sense 8). An earlier attempt to establish ‘worm’ in this sense around 1981–82 on Usenet was largely a failure.

What is computer hacking?
Hacking is the process of taking advantage of weakness in a computer or computer network to accomplish his goal. The person who is engaging in hacking activities  called as 'Hacker'.  Hackers may be motivated by a multiple reasons, such as profit, protest, challenge or just for fun.

Cracker
One who breaks security on a system. Coined ca. 1985 by hackers in defense against journalistic misuse of hacker (q.v., sense 8). An earlier attempt to establish ‘worm’ in this sense around 1981–82 on Usenet was largely a failure.

Use of both these neologisms reflects a strong revulsion against the theft and vandalism perpetrated by cracking rings. While it is
expected that any real hacker will have done some playful cracking and knows many of the basic techniques, anyone past larval stage is expected to have outgrown the desire to do so except for immediate, benign, practical reasons (for example, if it’s necessary to get
around some security in order to get some work done). Thus, there is far less overlap between hackerdom and crackerdom than the mundane reader misled by sensationalistic journalism might expect. Crackers tend to gather in small, tight-knit, very secretive groups that have little overlap with the huge, open
poly-culture this lexicon describes; though crackers often like to describe themselves as hackers, most true hackers consider them a separate and lower form of life.

It’s clear that the term cracker is absolutely meant to be derogatory. One shouldn’t take the tone too seriously though, as The Jargon File is done with a
sense of humor, and the above is said with a smile. As we can see from the above, illegal or perhaps immoral activity is viewed with disdain by the “true
hackers,” whomever they may be. It also makes reference to cracker being a possible intermediate step to hacker, perhaps something to be overcome.

Script Kiddie
The term script kiddie has come into vogue in recent years. The term refers to crackers who use scripts and programs written by others to perform their intrusions. If one is labeled a “script kiddie,” then he or she is assumed to be incapable of producing his or her own tools and exploits, and lacks proper understanding of exactly how the tools he or she uses work. As will be apparent by the end of this chapter, skill and knowledge (and secondarily, ethics) are the essential ingredients to achieving status in the minds of hackers. By definition, a script kiddie has no skills, no knowledge, and no ethics.

Phreak
A phreak is a hacker variant, or rather, a specific species of hacker. Phreak is short for phone phreak (freak spelled with a ph, like phone is). Phreaks are hackers with an interest in telephones and telephone systems. Naturally, there has been at times a tremendous amount of overlap between traditional hacker roles and phreaks.

White Hat/Black Hat/Gray Hat
White Hat Hacker:
White Hat hackers are good guys who does the hacking for defensing.  They probably work an organization for providing security.

Black Hat Hacker
Black hat hackers are bad guys(the malicious hackers or crackers).  They usually steal the other bank information and steal the money.
They use their skills for illegal purposes.
They are creators of viruses,malware,spyware.
They will destroy your pc.

Gray Hat Hackers:
Grey hats are hackers who may work offensively or defensively, depending on the situation.  This is the dividing line between hacker and cracker. Both are powerful forces on the Internet, and both will remain permanently. And some individuals qualify for both categories.

The existence of such individuals further clouds the division between these two groups of people. In addition to these groups, there are self-proclaimed ethical hackers, who are interested in hacker tools mostly from a curiosity standpoint. They may want to highlight security problems in a system or educate victims so they secure their systems properly. These hackers are doing their “victims” a favor. For instance, if a weakness is discovered in a service offered by an investment bank, the hacker is doing the bank a favor by giving the bank a chance to rectify the vulnerability.

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