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In "Heart", Sam and Dean are clued in to the whole werewolf angle by the fact that the murders look like wolf-attacks, they take place at the full moon and the victim's heart is removed. Dean is very excited about it as he thinks werewolves are bad-ass, and they haven't seen one since they were kids. There's one way to kill hem which you can probably guess; a silver bullet to the heart (see top photo). The curse can only be transfered through biting, not through scratching or even sexual intercourse.
The first time we see the werewolf, it's definitely very human, almost vampiric-looking. But this is important to the plot as it does need to be recognised for who it actually is. It turns out that Madison doesn't even know that she's a werewolf, as she just has blackouts. Their dad had a theory about a possible cure, severing the bloodline, which doesn't work ("Werewolf" the TV show is maybe an influence .... there's even a mention of the "Incredible Hulk").
The episode "Sharp Teeth" introduces a few new ideas, such as the idea that werewolves can be born with the condition as well as being bitten. The pack of new-agey werewolves we encounter prefer the term "lycanthrope", and they each wear a silver bullet around their neck as a reminder of their mortality. As it turns out, a few of them also worship Fenrir, from Norse mythology, and want to bring about the end of the world. Neat touch!