Cactus is an in-container unit testing framework that allows testing of J2EE components by running tests inside a container. It avoids the drawbacks of mocking approaches, which don't test interactions with the container. Cactus tests are written by extending test case classes and implementing test methods. It works by starting the container and deploying the application and tests. Required jars include cactus, junit, and jars for HTTP client and HTML parsing. Spring also provides an alternative for integration testing without a full container deployment.