How should I respond when an audience points out an issue in my research in my talk? I am a PhD student, and just gave a talk about a model that my advisor and I have been working on in a small conference. During my talk, a professor pointed out that our model will have an serious issue in his field, which my advisor and I are not familiar with, so the model might not work. I wasn't sure how to respond to him at that moment. Fortunately, the issue only associates with part of my talk. And, my advisor was there, too. He responded to him that this part of the work is still in progress so I wasn't too embarrassed.

Therefore, I would like to ask, in general, 


How should I respond when an audience points out that there might be an issue in my work during my talk?
How often does this happen in an actual talk?
How serious is this?
Whatever you say, don't get defensive or passive-aggressive. Just discuss the remark as it is. He may be right, he may be wrong, and he may just have an interesting point, which, while not invalidating your approach, may show you some ways not to go. I've seen various possibilities and derailed at least one talk myself. Such situation is not very common but it happens now and then and what it really calls for is pursuing the issue to the end (not necessarily during the talk; you'll have to think when discussing such stuff, and being at the blackboard with 20 people looking at you slows your brain down quite a bit). 

If it is not immediately clear that the observation just kills the presentation completely (in which case the only decent exit is to step down) the obvious immediate response would be something along the lines "Thanks for the observation. I haven't noticed that. Let's discuss it right after the talk". In most cases people will be happy to do it and you'll learn something new in the process. It is normally understood that the discussion of a controversial point during the talk itself is not a great idea. 

As to how serious it is, it won't hurt your reputation much, if that was the question, but it may be serious enough to force you to completely abandon your current approach and that is something you'll need to find out. Don't expect the objection disappear once that professor is out of the room. If it was a valid point, it will arise again and again, so you'd better address the issue right away.