http://www.microsoft.com/security/slammer.asp
On the evening of Friday, January 24, Microsoft became aware of an Internet attack that was causing a dramatic increase in network traffic worldwide. Microsoft immediately began investigating the situation and learned that a worm, called "Slammer" or "Sapphire," was targeting computers running Microsoft� SQL Server� 2000 and MSDE 2000 systems.
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Slammer is an Internet worm targeting unpatched SQL Server and MSDE systems, resulting in a high volume of network traffic on the Internet.

The vulnerability that is exploited by this worm was first corrected by a Microsoft security patch in July 2002 and in subsequent cumulative patches, most recently in October 2002. These updates were also included in the recently released SQL Server 2000 Service Pack 3 (SP3) and MSDE 2000 Service Pack 3 (SP3). While systems that have installed any of these security patches are protected, Microsoft strongly recommends customers immediately take these steps:

Read the technical details and follow the instructions for installing the update on the PSS Security Response Team alert about Slammer.
Begin evaluation and deployment of SQL Server 2000 SP3 or MSDE 2000 SP3 as appropriate.
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It seems that if they had been properly patched, then the slammer may not have had as big effect as it did.

the moral of this story, get a REAL operating system.

Whats really ironic is that microsoft had a patch, but haden't installed it on it's own server. heh