PHP is subject to the security built into most server systems with respect to permissions on a file and directory basis. This allows you to control which files in the filesystem may be read. Care should be taken with any files which are world readable to ensure that they are safe for reading by all users who have access to that filesystem.
Since PHP was designed to allow user level access to the filesystem, it's entirely possible to write a PHP script that will allow you to read system files such as /etc/password, modify your ethernet connections, send massive printer jobs out, etc. This has some obvious implications, in that you need to ensure that the files that you read from and write to are the appropriate ones.
Consider the following script, where a user indicates that they'd like to delete a file in their home directory. This assumes a situation where a PHP web interface is regularly used for file management, so the Apache user is allowed to delete files in the user home directories.
Only allow limited permissions to the PHP web user binary.
Check all variables which are submitted.
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