With FileReference it’s as simple as this:

var myFileReference:FileReference = new FileReference();
myFileReference.save("i just put some string data here lol", "filename.txt");

and you’re done!

To get access to this functionality you will need to download the Flex 3.3 SDK.

If you are using FlexBuilder:

• install the sdk in the “sdks” directory of your FlexBuilder installation
• in Windows » Preferences » Flex » Installed Flex SDKs: Add the new SDK by simply pointing to the SDK path (and set it as default)
• make sure that your project’s preferences is set to use the new SDK
• Finally, set your project to demand at least Flash Player 10 from users (if you plan on using any of the new Classes)

A very slight drawback for this simple but fantastic feature is that the code triggering the FileReference has to be initiated by a user Event.  For security reasons of course.

This feature made me very happy and saved our project from at least a day of writing serverside crap.