The Microsoft use the AUTORUN.INF file from removable drives such as pen drive to know which actions to done when a new storage device, such as a USB drive or CD/DVD, is inserted into the PC.
This feature, widely critizised by the security peoples. It is used by hackers. The malware achieves this by copying a malicious executable in the drive and modifying the AUTORUN.INF file so that Windows opens the malicious file silently as soon as the drive is mounted.