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Let's say I'm in my own house, with my own wireless router and two computers are on and connected to the internet. One computer is currently accessing a website which needs a login to access certain features. So, in my little knowledge of computers, would say that the login/pwd data is transfered like this: firstComputer -> wireless router -> website -> website processes information and authenticating (website is now allowed to send the features because the login/pwd is right) -> wireless router -> firstComputer. If the second computer is also connected to the same wireless router, can it intercept (get the data) that's being sent to and from the first computer? Are there any software examples of that? Thanks in advance.

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Usually the data cannot be intercepted if you have encryption enabled. Be sure that you enable encryption in your WiFi settings. Usually WEP and WPA2 are available as encryption settings. I strongly recommend using WPA2 encryption because there have been cases of WEP being hacked.

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WEP is more vulnerable than WPA which is more vulnerable than WPA2, suppose? – Richard Morton Oct 12 '12 at 12:59
Which are the methods of encrypting data? Is it by time or there are specific algorithms for each router...? – Richard Morton Oct 12 '12 at 13:00
yes you are right. WEP is more vulnerable than WPA which is more vulnerable than WPA2. And encryption method is not related to router. these are all standard methods. you will have the same encryption settings irrespective of router. – GuiccoPiano Oct 12 '12 at 13:02
Thanks for the extra info :D – Richard Morton Oct 12 '12 at 13:12

Any data you broadcast can be intercepted.

However if they can understand the information in the intercepted data depends on a few things:

If you used no encryption at all then they can just read the data.
If you encrypted the wireless signal then they need to decrypt it first.

How hard this is depends on a lot of things. Cracking ancient WEP encryption takes about 10 seconds on a mid level computer. You might as well not use it.

Its successor, WPA is also to weak to withstand current day computers.

WPA2 still seems adequate today. Cracking a WPA2 link with a decent password can be done. The last article I read on that used a dozen amazon instances with massive GPU support and then it took about a day to crack it. This means two things: 1) Right now WPA2 is probably secure enough unless someone is very determined. 2) In a few years when computers will be faster, it will be to weak.

So much for the wireless part. There is however a second layer of encryption which you are likely using: SSL/TLS. The website should not allow you to log in via plain HTTP. You should be on a HTTPS. That allows the website to encrypt the communication between you and the website. (And any sensible website will have that enabled). Which would add a second layer of encryption which also needs to be cracked.

Using a key sniffer might be a lot easier than breaking these two layers.

TL;DR version:

Whatever you do, if you transmit things wireless they can be intercepted an cracked. But it might require more effort than it is worth.

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When exactly is the encryption made? I'm not sure if trying to crack the network is necessary since I'm already connected to it. – Richard Morton Oct 12 '12 at 13:24
What you associate with the wireless access point keys are exchanged. How and when depends on the encryption used. E.g. with WEP this is done once and that key is used for all future communication. With WPA2 an initial authentication is done using a Pre-Shared Key (aka the WPA2 password for the network). Once the initial authentication is completed another so-called Master Key is generated which is bound to the particular session between the access point and the client. My understanding is that this part is unique between your computer and the WAP. – Hennes Oct 12 '12 at 13:36
Thanks a lot! :D – Richard Morton Oct 12 '12 at 14:02

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