Here we go again. Oracle has once again dropped the ball by dragging its feet on Java security updates. This latest exploit has been know about since August and is mainly the result of Oracle not properly patching the previous Java exploit.
How does this effect you? First off, you should disable your Java browser plugins for ALL web browsers. Apple has already said that it will disable the Java plugin for Safari with the next software update. However, you should be more proactive and verify that Java is actually disabled. If you are using Firefox or Chrome, you will need to disable the plugin on your own. I would suggest to do the same for Safari. There are already know active exploits on the web. Here are instructions for disabling the plugins in Safari, Firefox and Chrome.
You can read more about this exploit here.
****Update Jan. 14th 2013****
Oracle has released an update for Java that fixes this exploit. You can get the update here. Or, goto the Java Preference Pane in system preferences and click the "Update" tab.