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There are two important actions that can protect users from packet sniffers and other eavesdropping attacks.
First, use encryption! If you encrypt sensitive data and passwords while in transit, you'll render packet sniffers useless.
Encryption can be implemented in a number of ways: SSL (HTTPS) connections to Web servers, encrypted SSL or TLS connections to mail servers, or other application-specific techniques. Alternatively, you can use a virtual private network (VPN) to encrypt entire communications links, regardless of protocol.
Second, use a switched network. In this case, a packet sniffer will only be able to eavesdrop on connections taking place on its own local switch port. If you assign each system to an individual switch port, there simply won't be any packets for the packet sniffer to intercept.
More information:
Looking to sniff out problem packets? Contributor Scott Sidel recommends Wireshark.
Use a packet sniffer to determine whether an email message is encrypted or not.
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