A method for containing a threat in network environment using dynamic firewall policies is provided. In one example embodiment, the method can include detecting a threat originating from a first node having a source address in a network, applying a local firewall policy to block connections with the source address, and broadcasting an alert to a second node in the network. In more particular embodiments, an alert may be sent to a network administrator identifying the source address and providing remedial information. In yet other particular embodiments, the method may also include applying a remote firewall policy to the first node blocking outgoing connections from the first node.