To elaborate:

Cracker/Hacker: A person who uses his or her computer knowledge to subvert the appropriate use of a computer system. For example, the use of a bug in an internet service, like e-mail, to gain supreme priveleges on a system that does not belong to him or her.

Hacker Definition II: Someone who uses their superior computer knowledge for good purposes - fixing bugs in software, writing his or her own software, etc. Software hackers try to keep this definition alive, but it has fallen out of use for the most part.

Warez: Pirated software - not a derogatory term, actually. Software pirates use this word interchangeably with others to describe pirated software.

Warez Puppy/Kiddie: A derogatory term for a software pirate.

There are two types of pirates - distributors and crackers. Crackers actually crack the software and prepare the distribution. Distributors do just that - operate sites that make the software available for download.