system is in stdlib.h, not stdio.h. It's not a good idea either because now you depend on an outside program that might be malicious. It's a big security no-no because you created a hole that hackers...

No, it doesn't. But you _do_ lose the only reference to the space you had, and that's called a memory leak because now it's allocated and won't be freed until the program ends. If your OS doesn't...

You need to include stdlib.h. The error cryptically tells you that malloc wasn't declared and the compiler just assumes it's a function that returns int and casting from int to char* isn't friendly.