If you can use Adblock Plus for Firefox or Chrome do that…it's way easier.

However, if you have an embedded device that you want to hide ads on (such as a Boxee box), this is an easy way to achieve that. We can take the list that Adblock Plus uses (EasyList) to block ads and convert it so that it can be used by the Privoxy non-caching HTTP proxy. This requires a Linux box (or maybe a Windows box with cygwin bash?).

First, get Andrwe Lord Weber's privoxy-blocklist.sh saved to a directory on the Linux box.

Then, assuming you're on Ubuntu:

$ sudo apt-get install privoxy
$ sudo bash privoxy-blocklist.sh
$ sudo nano /etc/privoxy/config

Edit /etc/privoxy/config so that listen-address is set to "0.0.0.0:8118" – this allows non local clients to connect. Restart:

$ sudo service privoxy restart

At this point, you should be able to set the proxy of your browser to the IP address of the machine in question, port 8118. Ads should be blocked just as if you were using AdblockPlus.