What’s the right way to decode a string that has special HTML entities in it? [duplicate]

This is my favourite way of decoding HTML characters. The advantage of using this code is that tags are also preserved.

function decodeHtml(html) {
    var txt = document.createElement("textarea");
    txt.innerHTML = html;
    return txt.value;
}

Example: http://jsfiddle.net/k65s3/

Input:

Entity:&nbsp;Bad attempt at XSS:<script>alert('new\nline?')</script><br>

Output:

Entity: Bad attempt at XSS:<script>alert('new\nline?')</script><br>