This week's book giveaway is in the OCPJP forum. We're giving away four copies of OCA/OCP Java SE 7 Programmer I & II Study Guide and have Kathy Sierra & Bert Bates on-line! See this thread for details.
An applet cannot ordinarily read or write files on the host that is executing it. The JDK Applet Viewer actually permits some user-specified exceptions to this rule, but Netscape Navigator 2.0, for example, does not. Applets in any applet viewer can read files specified with full URLs, instead of by a filename. A workaround for not being to write files is to have the applet forward data to an application on the host the applet came from. This application can write the data files on its own host. See Working with a Server-Side Application for more examples.