The host becomes so busy that it cannot deal with any other requests from remote host or even local hosts. Since it cannot service any other request, it is effectively taken off the network. For example, if you run a web server, a remote host floods your Mac with so many requests that it can t serve each request. Over a period of time this usually ends up crashing either the application or operating system. There are ways to prevent attacks and intruders.
Firewalls help prevent and log network access.
NetBarrier and DoorStop. Recently I have looked at both packages. The PoweBook and Linux box represent the Internet in this scenario. If you are looking for simple setup and functionality, look at the DoorStop package. It is straight forward in both setup and configuration.