Summary: Many people are experiencing high CPU usage, often 100%, in svchost. Svchost is not a virus, but many people think it acts like one.
After I log in, my system slows to a crawl. Looking at task manager I see that my computer is experiencing high CPU usage. Looking more closely I see that something called "svchost" is taking 100% of my CPU time. If I kill the process suddenly other things stop working. Is svchost a virus? How do I fix this svchost problem?
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Important: please see the update near the end of this article.
That's actually a composite question based on several reports I've been getting recently.
Svchost is not a virus. In fact it's a required system component. You'll often find several copies of svchost running.
Svchost, or more correctly "Service Host", is a program that is designed to run other programs and "hosts" many of the system services in Windows XP. Several copies of Svchost run more than one service, which is why when you kill an instance of svchost several things on your machine might stop working.
So why is one of the Svchosts taking all your CPU?
And what can you do about it?
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From what I've heard and have been able to tell, this is nothing more than a bug. A serious and annoying bug, but a bug nonetheless.
The bug appears to be related to the Windows Update service - the service that you're supposed to keep running at all times so that updates will be automatically downloaded to your machine.
A quick way to tell if this is happening to you is to download Process Explorer and right click on the svchost instance that's taking 100% of your CPU and then click on the Services tab:

You can see that this copy of svchost on my machine is running not only The Windows Update service, but is actually running 29 services all totaled. So if you were to kill this instance of svchost you'd be killing all of those services and many features and functionality of your system would fail.
One Temporary Solution
One approach to this problem is to stop and then disable the Windows Automatic Update service. If you have it open in Process Explorer, as shown above, with Automatic Updates selected in the list, then just click the Stop button. If your CPU usage then drops to more normal levels, you've identified the problem.
To prevent the Automatic Update service from starting again, right click on My Computer and click on Manage. Expand Services and Applications, and then underneath that click on Services. In the resulting list on the right, locate Automatic Updates:

Right click on Automatic Updates and click on Properties. Change the Startup type to Disabled:

(You can also click Stop here if you didn't stop the service earlier.)
Click OK and Automatic Update service should be disabled.
IMPORTANT: since you won't be getting updates automatically, you should now plan on visiting the Windows Update web site periodically to make sure you keep your Windows up to date. As we'll see shortly, this will also become important to resolve this problem "for real".
Another Temporary Solution
Folks commenting on a previous svchost article have reported success by removing and reinstalling Windows Update.
Specifically a series of commands detailed at amset.info labeled Remove and Reinstall of Automatic Updates seems to resolve the issue for many people.
I haven't tried this solution since I've not experienced the problem, but as I said, several folks are reporting good results.
A Permanent Solution?
There isn't a permanent solution. Not yet anyway.
There are rumors that Microsoft actually has a fix, but that you need to call up and ask for it rather than getting it through normal channels. I'm not convinced that this fix is actually for this specific problem that so many people are experiencing.
There are also rumors that Microsoft will be making the actual fix available in a future automatic update. Ironic, since it's automatic update that you may have turned off in order to work around the problem. That's why I recommend making certain you regularly visit Windows Update and take the latest fixes to keep your system up to date, not only for this issue but for any other issues that may crop up over time.
Also, remember, once the problem is fixed, be sure to re-enable the Automatic Updates feature. It remains an important part of keeping your system safe and up to date.
Update!
23-May-2007
I woke to find this automatic update waiting to be installed on my machine this morning:

This is the update that's been frequently referenced as a resolution for this problem.
It's possible, perhaps even likely, that this issue will now get put to bed. It's your choice at this point: you should be able to visit Windows Update to take the fix, enabling Automatic Updates again should get the fix downloaded, or you can visit the knowledgebase article to get the fix.
Related:
Svchost and Svchost.exe - Crashes, CPU maximization, viruses, exploits and more. Svchost (and Svchost.exe) is a required Windows component that often shows up in errors caused by viruses. Review Svchost, Svchost.exe, and how to stay safe.
What is svchost, and why is there more than one copy running? Svchost is a component of Windows. It can be confusing because more than one copy is running, and it often shows up in errors caused by viruses.
Where is it alright for svchost.exe to be? Svchost.exe is frequently spoofed by viruses attempting to hide. The official copy should be in your Windows\system32 folder, but there may be others.
Article C3020 - May 9, 2007
lol why dont u just open your task manager and click view then update speed then select normal.
Posted by: Cocoson at January 26, 2010 8:09 AMoh would u look at that your CPU usage is back to working right
While grateful to find this article, it didn't help!! Everything started after I tried to go to a website (for examples of business letters.)
I downloaded the process explorer and the svchost killing my CPU only had two services included:DCOM launch and TermService. I turned off updates to check if it made a difference anyway...it didn't. What now? I have been running every antivirus I can. Even paid for some....
HELP! Worse possible time this could happen.
Posted by: RaeofSun at January 28, 2010 5:48 PMHi Leo,
My issue was a bit different, but the help you provided here guided me in the right direction, and gave me enough help to fix it. My "hogger" of CPU, for some strange reason, turned out to be the Windows sidebar. I thought it had been acting a little weird lately, with these borders around the edges that do not normally appear. But I had no idea that it was causing the CPU problem. Afer I closed Windows sidebar, it fixed it. My fan has been running constantly for weeks. Thank you VERY much for your help!! My ears feel much better now!!
I was afraid that once I re-opened Windows sidebar, that the same problem might start happening again, but so far so good. I know I should probably still clean my computer, so I will have to work on that too. Thanks again!! You rock!!
Posted by: Scott at February 5, 2010 2:53 PMHi Leo,
Just another note. I also found this link helpful. It's a link to a Microsoft support site. Apparently other people have been having the same problem with the windows sidebar hogging CPU.
Posted by: Scott at February 5, 2010 3:16 PMHi Leo,
Sorry, forgot the link ....
http://social.answers.microsoft.com/Forums/en-US/vistaappearance/thread/89cfd703-6ab7-40ac-990a-858907ce6f29
Posted by: Scott at February 5, 2010 3:18 PM