This has become, by far, the most popular post on my site. Thank you for all of the interest. In the time since I originally wrote this in 2007, the BitTorrent and Peer to Peer landscape has changed substantially. PeerGuardian is no longer considered safe. MoBlock does not work either. For your own personal protection, I would recommend purchasing a VPN service or consider switching to newsgroups.
BitTorrent is under constant attack by governments, ISPs, and private industry groups. Many want to shut down this invaluable tool completely. ISPs have been throttling torrents slowing down your progress. They don't recognize the advantages it carries allowing large groups to share data for free and/or open source software, indie artists, and other copyleft material. Its tremendously easier downloading Linux or free indie artists now than it was ten years ago.
Phoenix Lab’s PeerGuardian offers IP blocking. This is an open source program built for Windows and designed to protect individuals from snooping governments and anti-P2P groups. This will actually run on Windows 98 through 7 and Mac OS X 10.4.9 and later.
If you’re a Linux user like me, Phoenix Labs recommends MoBlock. By default, they offer Tarballs but you can add their repo to your Debian based system by hitting up their Sourceforge page. The SF DEB file supports Ubuntu 11.04 Natty.
The other part of protecting yourself is encrypting your torrents. Most BitTorrent programs include an option for encryption. Usually this is located under the options or preference menus. TorrentFreak has a how-to for Azureus, Bitcomet, and uTorrent.
Why is all this so important? As much as 25% of connected peers on major torrents can be anti-P2P agencies. These groups work to pollute torrents with junk. In turn, you end up downloading a lot more than you need to. By using MoBlock or PeerGuardian you can block these groups and help protect your personal privacy.
I absolutely do not advocate nor condone the distribution of illegal material through BitTorrent or any other peer to peer file sharing systems. I'm an open source advocate who believes the free sharing of knowledge will advance our civilization rapidly. The free sharing of private property will just land you in jail or at least in court.