The report shows that the total amount of malware and potentially unwanted software removed from computers worldwide grew over 43 percent for the first six months of the year.
Interestingly, the study - the fifth in Microsoft's bi-annual series - also revealed a continued rise in both Trojan downloaders (such as adware Zlob and ZangoSearchAssistant) and high-severity vulnerabilities (up 13 percent).
This, says Microsoft, shows that financial gains remains one of hackers' top motivations.
The report also claims to show how attacks are continuing to move into the application layer and away from the operating system,
This is show with 90 percent of vulnerabilities discovered in the first half of 2008 affected applications, while only 10 percent affected operating systems.
Microsoft says that online threats are continuing to evolve at an increasing rate.
The software giant claims that hackers are not only producing generic attacks but attacks are also being customized targeting a particular demographic or geographic region.
Other findings include the fact that organized crime on the Internet to commit identity theft continues to increase with China, Brazil and Russia amongst the most frequently attacked countries in the world.
For the second half of 2008, Microsoft predicts that the industry will see the number of threats and vulnerabilities increase, particularly around the application layer as the operating system element becomes harder to target.