Ethical hacking is the practice of testing a system's security defenses to identify vulnerabilities with the owner's permission. It helps protect data, prevent cyber attacks, and enhance security. Ethical hackers use the same methods as malicious hackers but aim to improve security rather than harm the system. The process involves reconnaissance, scanning, gaining access, maintaining access, and covering tracks to identify weaknesses from an attacker's perspective. Organizations benefit from ethical hacking but also face challenges regarding skills, tools, legal issues, and time requirements.