How do I install an application from a .dmg disk image? I've downloaded Firefox and it's now sitting on my desktop as Firefox.dmg. When I double click on Firefox.dmg it opens up a window with Firefox in it so I can use it - does this mean the application has been installed?



Community Wiki'd the question because I think it's a worthwhile question to have on the site for pointing people to, it's not exactly intuitive to do and not a question I think I deserve any rep from.
Applications that are distributed on disk images (.dmg files) are designed to be installed using drag and drop. You can safely drag and drop the application from the virtual drive into your Applications folder and use it from your Applications folder. After copying it to your Applications folder it's safe to eject the virtual drive and delete the disk image file.

Nearly all applications will work just fine running off that virtual hard drive as they store their content in your user folder (eg. browsers, mail applications, etc.). It will however stop you from running application updates as the disk image is read only.