Origins

People create viruses. A person has to write the code, test it to make sure it spreads properly and then release the virus. A person also designs the virus's attack phase, whether it's a silly message or destruction of a hard disk. So why do people do it?

There are at least three reason

The first is the same psychology that drives vandals and arsonists. Why would someone want to bust the window on someone else's car, or spray-paint signs on buildings or burn down a beautiful forest? For some people that seems to be a thrill. If that sort of person happens to know computer programming, then he or she may funnel energy into the creation of destructive viruses.

The second reason has to do with the thrill of watching things blow up. Many people have a fascination with things like explosions and car wrecks. When you were growing up, there was probably a kid in your neighborhood who learned how to make gunpowder and then built bigger and bigger bombs until he either got bored or did some serious damage to himself. Creating a virus that spreads quickly is a little like that -- it creates a bomb inside a computer, and the more computers that get infected the more "fun" the explosion.

The third reason probably involves bragging rights, or the thrill of doing it. Sort of like Mount Everest. The mountain is there, so someone is compelled to climb it. If you are a certain type of programmer and you see a security hole that could be exploited, you might simply be compelled to exploit the hole yourself before someone else beats you to it. "Sure, I could TELL someone about the hole. But wouldn't it be better to SHOW them the hole???" That sort of logic leads to many viruses.

Of course, most virus creators seem to miss the point that they cause real damage to real people with their creations. Destroying everything on a person's hard disk is real damage. Forcing the people inside a large company to waste thousands of hours cleaning up after a virus is real damage. Even a silly message is real damage because a person then has to waste time getting rid of it. For this reason, the legal system is getting much harsher in punishing the people who create viruses.

Number of Viruses

There are more MS-DOS/Windows viruses than all other types of viruses combined (by a large margin). Estimates of exactly how many there are varying widely and the number is constantly growing.
In 1990, estimates ranged from 200 to 500; then in 1991 estimates ranged from 600 to 1,000 different viruses. In late 1992, estimates were ranging from 1,000 to 2,300 viruses. In mid-1994, the numbers vary from 4,500 to over 7,500 viruses. In 1996 the number climbed over 10,000. 1998 saw 20,000 and 2000 topped 50,000. It's easy to say there are more now.
The confusion exists partly because it's difficult to agree on how to count viruses. New viruses frequently arise from someone taking an existing virus that does something like put a message out on your screen saying: "Your PC is now stoned" and changing it to say something like "Donald Duck is a lie!". Is this a new virus? Most experts say yes. But, this is a trivial change that can be done in less than two minutes resulting in yet another "new" virus.
Another problem comes from viruses that try to conceal themselves from scanners by mutating. In other words, every time the virus infects another file, it will try to use a different version of itself. These viruses are known as polymorphic viruses.
One example, the Whale (a huge clumsy 10,000 byte virus), creates 33 different versions of itself when it infects files. At least one person counts this as 33 different viruses on their list. Many of the large number of viruses known to exist have not been detected in the wild but probably exist only in someone's virus collection.
David M. Chess of IBM's High Integrity Computing Laboratory reported in the November 1991 Virus Bulletin that "about 30 different viruses and variants account for nearly all of the actual infections that we see in day-to-day operation." Now, about 180 different viruses (and some of these are members of a single family) account for all the viruses that actually spread in the wild. To keep track visit the Wild list, a list which reports virus sightings.
How can there be so few viruses active when some experts report such high numbers? This is probably because most viruses are poorly written and cannot spread at all or cannot spread without betraying their presence. Although the actual number of viruses will probably continue to be hotly debated, what is clear is that the total number of viruses is increasing, although the active viruses not quite as rapidly as the numbers might suggest.