Wireless Tether (Free)
Android 2.2 adds native support for Wi-Fi tethering so you can use the Internet connection of your phone wirelessly on computers and other Wi-Fi devices. But if you’re using an earlier version or your service provider has disabled the feature, you can use an app like Wireless Tether to circumvent any roadblocks. It can broadcast your Internet via Wi-Fi (ad-hoc) network or Bluetooth. It features Wi-Fi encryption (WEP, WPA, and WPA2) and lets you set the SSID (network name), channel, and transmit power for the Wi-Fi connection. The access control feature also lets you specifically allow/deny users when they attempt to connect.
SSH Tunnel (Free)
SSH Tunnel helps you secure your web browsing and Internet activity on your Android, great for preventing eavesdropping when using public Wi-Fi hotspots. The Android app Faceniff and the Firefox add-on Firesheep now make it easy for anyone to hijack your unencrypted online accounts, but not when you’re using this app.
Keep in mind, you must also setup an SSH server or have access to one in order to use this app. It’s a special SSH client that can proxy your Internet activity to the SSH server, encrypting your connection from local eavesdroppers.
Though rooting isn’t required for this app, it’s needed for full functionality. Additionally, your ROM must be using IPTABLES.
DroidSheep is just like the Android app Faceniff and the Firefox add-on Firesheep. It scans the Wi-Fi network looking for logins to unencrypted (non-SSL) sites from other users on the Wi-Fi. When found, it hijacks the session so you view and use their account from your phone. Obviously, this is illegal in most countries and you shouldn’t use it for hacking other people’s account. You could hack your own account(s) to see just how easy it is, however, and why you should use an app like SSH Tunnel to secure your Internet activity (or at the very least, use the HTTPS function of whatever site you’re visiting).