Why does my mouse jump around on the screen?

If you have an optical mouse, that is, one with a light on the bottom rather than a ball, then it could be that it is getting confused when you move it...

Optical Mice vs Ball-type Mice
Rather than use a ball to measure the distance the mouse has been moved, an optical mouse uses a camera and light to "see" how far and in what direction the mouse has moved. It does this by taking a snapshot of the desk surface and comparing it with the last snapshot taken. If you have a particularly 'noisy' surface or a very shiney surface then the mouse can incorrectly compare these snapshots and think that it has moved further than it has, in a different direction, or both.

How do I fix this?
Find a mouse pad that states that it is designed for optical mice. There are gaming mouse pads that have matte finishes which are well suited for optical and laser mice.

So, why not just use a ball-type mouse?
Ball-type mice are still widely used and are more suitable for some environments. They do not have the tracking trouble above because they are constantly in contact with the surface - measuring as they go. Of course they have their own issues. When they clog with dirt, they will roll unevenly and sometimes stop alltogether until they are cleaned.

Optical mice have no moving parts, related to determining postition, that can fail. If an optical mouse is on a good surface, they should never have a position failures. Since they do not have the resistance of the ball tracking mechanism, they provide a smoother experience, are lighter than the ball type moues, and often provide a faster response during gaming.