The changing nature of warfare has seen a paradigm shift from the conventional to asymmetric, contactless warfare such as information and cyber warfare. Excessive dependence on information and communication technologies, cloud infrastructures, big data analytics, data-mining and automation in decision making poses grave threats to business and economy in adversarial environments. Adversarial machine learning is a fast growing area of research which studies the design of Machine Learning algorithms that are robust in adversarial environments. This paper presents a comprehensive survey of this emerging area and the various techniques of adversary modelling. We explore the threat models for Machine Learning systems and describe the various techniques to attack and defend them. We present privacy issues in these models and describe a cyber-warfare test-bed to test the effectiveness of the various attack-defence strategies and conclude with some open problems in this area of research.