Moodle 1.3.3 is now available, containing fixes for two pesky security vulnerabilities that were recently found, as well as a few other fixes and polishing. Here are the release notes and you can download the new version from the download page.
The vulnerabilities are not too bad, and no exploits are known. However, for peace of mind upgrading is recommended.
If upgrading is difficult then you can also use this security patch kit - moodle-patch-pre-1.3.3.zip - which contains two files to replace in your current Moodle system. It should work on all recent versions of Moodle.