This paper describes a competition-style of exercise to teach system and network security and to reinforce themes taught in class. The exercise, called NetSecLab, is conducted on a closed network with student-formed teams, each with their own Linux system to defend and from which to launch attacks. Students are expected to learn how to: 1) install the specified Linux distribution; 2) set up the required services; 3) find ways to harden the box; 4) explore attack methods; and 5) compete. The informal write-up at the end of the lab focuses on their research into defense and attack methods, which contributes to their grade, while their competition score is dependent on their abilities to attack during the competition. Surveys were performed to evaluate the efficacy of the exercise in teaching system security. (Contains 4 tables and 2 figures.)