Host files used in windows to describe many-to-one mapping of device names to IP addresses. Using this file is helpful when developing locally as it allows you to assign the URL of the site to a local IP.
First, find you host file:
Windows NT/2000/XP Pro c:\winnt\system32\drivers\etc\hosts
Windows XP Home c:\windows\system32\drivers\etc\hosts
The HOST file doesn't have an extention and can be opened with notepad.
** Before we go any further make sure you back this up - just in case ***