My computer detect virus and show "c:\windows\system32\drivers\etc\hosts"
How do I do about it?
My antivirus software is AVG.

The "hosts" file, in the location you specified, is a normal Windows file. A "virus" could have replaced it with something else. It's a simple text file. An unmodified hosts file is the following:

----------------------------------------------------
# Copyright (c) 1993-1999 Microsoft Corp.
#
# This is a sample HOSTS file used by Microsoft TCP/IP for Windows.
#
# This file contains the mappings of IP addresses to host names. Each
# entry should be kept on an individual line. The IP address should
# be placed in the first column followed by the corresponding host name.
# The IP address and the host name should be separated by at least one
# space.
#
# Additionally, comments (such as these) may be inserted on individual
# lines or following the machine name denoted by a '#' symbol.
#
# For example:
#
# 102.54.94.97 rhino.acme.com # source server
# 38.25.63.10 x.acme.com # x client host

127.0.0.1 localhost
----------------------------------------------------

You can replace your hosts file with the above text (between the "-----" lines) and eliminate any problems that a virus may have caused.

You can also download a hosts file from Blocking Unwanted Parasites with a Hosts File (http://www.mvps.org/winhelp2002/hosts.htm) that can be used to block a large number of bad sites.

In addition, a number of antivirus programs mistakenly indicate problems in hosts if they find anything except the default file. However, I use AVG also and AVG doesn't have a problem with my hosts file, even if I replace it with the one from mvps.org.

AVG is most likely reporting that your Hosts file has been altered. You could post the contenst here and I could tell you if it looks right (Open it in Notepad).

127.0.0.1