Sounds like you might have a virus.

WordPress › Support My Wordpress site has been hacked?

Thank you, removed script from lines in question in both folders and can now log in.

If this is a variant of the Gumblar virus, then make sure you scan all "index.php" and ".js" files in Wordpress for injected code. The virus can reinfect your entire installation if the code is in any file that loads through Wordpress.

Then you need to ask yourself...

How did the virus infect my site?

More than likely, you or someone who has access to your server visited an infected site. Do you store passwords in your FTP client? Some variants of the virus can steal this information, log-in through FTP to all of your sites, and inject the virus.

A variant of Gumblar infected some of my sites earlier this year. It's a headache to get rid of. If it was me, here's what I would do:

1. Delete Wordpress from your server
2. Make sure none of your other directories are infected
3. Delete all of the virus code and upload clean files
4. Remove all passwords from your FTP client
5. Scan your computer with Avast Anti-Virus software (AVG didn't detect the virus, but Avast did)
6. Change your FTP passwords
7. Reinstall Wordpress through Fantastico.