The main purpose of a cookie is to identify users and possibly prepare customized Web pages or to save information.

What do Cookies Do?
A cookie (called an Internet or Web cookie) is the term given to describe a type of message that is given to a Web browser by a Web server. The main purpose of a cookie is to identify users and possibly prepare customized Web pages or to save site login information for you. When you enter a Web site using cookies, you may be asked to fill out a form providing personal information; like your name, e-mail address, and interests. This information is packaged into a cookie and sent to your Web browser, which then stores the information for later use. The next time you go to the same Web site, your browser will send the cookie to the Web server. The message is sent back to the server each time the browser requests a page from the server. A Web server has no memory so the hosted Web site you are visiting transfers a cookie file of the browser on your computer's hard disk so that the Web site can remember who you are and your preferences. This message exchange allows the Web server to use this information to present you with customized Web pages. So, for example, instead of seeing just a generic welcome page you might see a welcome page with your name on it.

Types of Cookies

session cookie
Also called a transient cookie, a cookie that is erased when you close the Web browser. The session cookie is stored in temporary memory and is not retained after the browser is closed. Session cookies do not collect information from your computer. They typically will store information in the form of a session identification that does not personally identify the user.

persistent cookie
Also called a permanent cookie, or a stored cookie, a cookie that is stored on your hard drive until it expires (persistent cookies are set with expiration dates) or until you delete the cookie. Persistent cookies are used to collect identifying information about the user, such as Web surfing behavior or user preferences for a specific Web site.

What Information Does a Cookie Store? For the most part a cookie will contain a string of text that contains information about the browser. To work, a cookie does not need to know where you are from, it only needs to remember your browser. Some Web sites do use cookies to store more personal information about you. However, this can be done only if you yourself have provided the Web site with that personal information. Legitimate Web sites will encrypt this personal information stored in the cookie to prevent unauthorized usage by another party with access to your cookie folder.

Cookies have six parameters that can be passed to them:
The name of the cookie.
The value of the cookie.
The expiration date of the cookie - this determines how long the cookie will remain active in your browser.
The path the cookie is valid for - this sets the URL path the cookie us valid in. Web pages outside of that path cannot use the cookie.
The domain the cookie is valid for.
This makes the cookie accessible to pages on any of the servers when a site uses multiple servers in a domain.
The need for a secure connection - this indicates that the cookie can only be used under a secure server condition, such as a site using SSL.