(Microsoft Corp Vice President of Internet Explorer Dean Hachamovitch unveils Microsoft Internet Explorer 9 Beta version during a demonstration in San Francisco, California in this September 15, 2010 file photo)
The opt-in feature, called "tracking protection", is based on technology developed for Microsoft's current browser. It was downplayed as the world's largest software company tried to balance consumers' demands for privacy with advertisers' desire to gather data about users.
Microsoft said the technology was based on InPrivate Filtering, a little-used feature in Internet Explorer 8 that allowed certain sites to be blocked, but had to be switched on each time a new browser session was launched.
There is growing concern over websites and advertisers using technology to track sites on the Internet to build up profiles of users, generally without their knowledge or explicit consent.
Last week the Federal Trade Commission backed creation of a "do not track" option that would limit advertisers' ability to collect consumers' data online.
Advertisers generally oppose the idea, and several Republicans, who will control the House of Representatives next year, have criticized legislation as a potential drag on Internet commerce.
Microsoft is trying to satisfy the millions of users of the world's most popular browser while ratcheting up revenue from advertisers as it tries to catch up with Internet leader Google Inc.
Many ads or invisible elements on Web pages, from weather information to stock quotes and embedded videos, can automatically load a user's Internet address and Web page being viewed. Using "cookies," or strings of data saved by the browser, websites can build a profile of a user over time.
Microsoft said its "tracking protection" feature would meet demands being discussed by the FTC by allowing users the option of blocking content from certain advertisers within a Web page. Users can build their own lists of sites to block, or subscribe to lists prepared by outside sources.
Microsoft likens its new feature to a "do not call" list used to prevent unsolicited telephone marketing.
Once a user blocks a site or element within a site, the browser limits data requests to that site to prevent exchange of information.
The new feature will be included in IE9, the latest version of Microsoft's Internet Explorer browser, expected to be released some time next year. Microsoft's browser has about 60 percent market share.
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