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answers:

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I'm building a site and I would like to have external content dynamically loaded in a div using jQuery. The content could be a google search page, where one can navigate without actually leaving the site. Could someone exploit this and drive to a content of his own and run malicious code inside my site? Are there ways to prevent this? Is using an iframe the best bet?

A: 

Your main concerns, when doing cross-domain AJAX are cross-site request forgery and cross-site scripting. A quick Google search, revealed this article. So instead of paraphrasing, I'd just reccommend you go and read it and follow some of the links to more in-depth discussions on the expoits you are opening yourself up to.

Kieran Hall