A USB drive is (used to be) called a "flash" drive for a reason.
It's called a Flash drive because it uses a memory technology called "Flash Memory." Flash memory is non-volatile meaning that, unlike RAM memory, it keeps its contents even when power is removed. Flash memory is solid-state meaning that, unlike disk drives, it has no moving parts which should make it more reliable. Finally, Flash memory is rewrittable meaning that, unlike CD ROM, it can be erased and used many times.
Flash memory comes in two flavors: NAND and NOR. The difference is in how the memory cell is physically constructed. Google if you're really interested. Bottom line: NOR flash cells are physically larger which means that a given size of chip will contain less memory, and making NOR flash cells is a more complicated process which means lower yields which means higher prices.
So, why would anyone even make NOR flash? Because NOR flash cells are significantly more reliable and NOR flash is significantly more durable.
If you look at the technical datasheets for NAND flash chips, you'll see that they include such specifications as initial bad bits, how many bits of the chip can be non-functional when the chip is brand new; deterioration rate, how many bits can go bad per hour after the chip is in use; write error rate, what fraction of writes to the chip can be improperly recorded; read error rate, what fractions of reads to the chip can be erroroneous; data retention, how long the chip is expected to retain data; and others.
NOR flash is expected to have all bits working initially and keep all bits working through its useful life. It is expected to read and write properly each time, and its retention is several times longer than NAND flash.
In fact, I just checked the technical data for Micron NAND flash and it's only guaranteed for one thousand write cycles. This becomes even more significant when you understand that you can't write to individual bytes. You have to write to whole blocks at a time. So, any time any byte in a block needs to be written to, that whole block must be read out, the byte in question altered, and then the whole block re-written.
NAND flash with its significantly-higher densitities and significantly-lower costs is great for applications where the occational bit error doesn't matter. Consider, for example, an MP3 player. If there's a single bit error, the very worst thing that's going to happen is that you may hear a very tiny tick in the music; but it'll probabaly be so minor that your ears won't even perceive it.
But what happens when this NAND flash gets put into these USB drives (and most of them are NAND flash) and people start storing critical data on them?
Add to this the fact that these thumb drives sell for very competitive prices and, therefore, every vendor is cutting every corner they can. Couple that with the recent conversion to lead-free solder which isn't necessarily perfected yet. And you've troubles.
Basically, I strongly caution against using USB thumb drives for anything important.
