This page gives an overview of both the restrictions applets face and the special capabilities they have. You'll find more details in the Understanding Applet Capabilities and Restrictions lesson.
Every browser implements security policies to keep applets from doing damage.
This section describes the security policies that current browsers adhere to. However, the implementation of the security policies differs from browser to browser. Also, security policies are subject to change. For example, if a browser is developed for use only in trusted environments, then its security policies will likely be much more lax than those described here. It can't ordinarily read or write files on the host that's executing it.