What is the `installd` process, and why is it eating my CPU?
This is a daemon which is part of PackageKit framework and it's usually running as a background process for the "Software Update" GUI application.
For example, if you open the Software Update application and check for updates, take a look at the Activity Monitor--you'll see the "installd" process doing a bunch of work.

The reason it pegs your CPU is because it must compile the current list of software installed on your computer, and compare with the current version list received from Apple's servers.

You can set the frequency of Software Update checks in System Preferences and Software Update.

The default settings are both to "Check for updates" and "Download updates automatically".
You may adjust either setting, but I would not recommend turning it off altogether.

There's nothing wicked about this process - it's just set to download updates.

You can solve your CPU problem by lowering the priority of the process or by just killing the process in Activity Monitor.



Technical information:

The location in Lion OSX is in:
/System/Library/PrivateFrameworks/PackageKit.framework/Resources/installd

(if you have locate configured correctly, run: locate installd to find the right location).