Modem is always connecting to Internet..

I take it you use your browser to connect? That it is configured through IE? If so you need to open IE andclick on tools at the top click internet options, click the connections tab and view the dialer. it will have three choices to never dial, always dial my default connection, and dial whenever a network connection is not present. It sounds like you have dial whenever there isnt a connection, so pick one of the others and hit apply and try.
As for a hardware issue your modem could be hosed. Did you have any lightening storms since this started? Did you install any new software of drivers? Go into device mgr. remove the modem and then try to reinstall it, but make sure you have documentation of the modem and any support info prior to uninstalling. Hit the refresh to have it re-recognize the modem and apply any drivers if necessary. Do a control alt delete and view the task mgr for programs running, if you see RNAAPP highlight it and end task it, reboot and re-attempt connection. a great site for help is www.modemhelp.net. It has all error messages with basic fixes, init strings, and everything else.

Answer my questions including operating system and specs on the computer to better assist.

I have seen this before and it was downright scary, particularly the reason why! I hope it is not your your prblem but you must immediately do a virus scan wth an updated scanner. If you do not have a recent update go to a site called BitDefender.com and get a free scan. There is a possibility you have a trojan horse which have unloaded a backdoor program along with a related ftp applet. What might be happening is this invader is attempting to dial out of your computer to its master. These things will send your infomation such as passwords and email addresses as well as anything the invader wants and it also can record youe keystrokes. It can also use your machine as a spam mailer! I have actually witnessed this activity. Check with an up to date scanner and go to Zonelabs.com and also download the free firewall. Its easy to install and setup. I hope this is not your problem but you can never be too careful.

One way to bust a hacker/virus file is to not be connected to the internet. If the autodial feature is on then the pc will attempt to connect. I agree with answer 2 get the latest dat file for your virus software and scan everything. Also get the free tools AdAware (www.lavasoft.com) or spybot search and destroy and run to check for that type of activity.

On win98/ME click start, select run and type in msconfig. Go to the startup section and see if anything unusual is being started when the system boots. You can uncheck items in the list of startup files to see if its the culprit.

Turn off system restore if it is used in your os.

Download, update, and run the following.

Spybot:
http://tinyurl.com/ziar

Ad-Aware:
http://tinyurl.com/tek5

CWshredder:
http://tinyurl.com/2bzef
Or
http://tinyurl.com/2k642
Look for the file in English CWShredder.exe

Hijack This:
http://mjc1.com/mirror/hjt/

Hijack This is useful in that it shows what is currently loading on startup. You must know what is good and what is bad. Once you check it and fix it is gone. So be sure.

I have had to boot into safe mode and run these.

Good Luck Lee

Goto start -> settings -> dialup networking -> right click on the connection and go to properties. Goto the dialing tab, allow it to be the default connection however ensure NEVER DIAL A CONNECTION is checked ! Then save, should cure your problem.