Final answer:
The word 'earth' is incorrectly capitalized in the sentence and should be 'Earth' when referring to the planet.
Step-by-step explanation:
The word in the sentence 'The earth is the third planet' that is incorrectly capitalized is 'earth.' According to conventional rules of grammar and style, the word 'Earth' should be capitalized when it is used as the proper name of our planet.
This is similar to how 'Moon' is capitalized when it refers to Earth's satellite, but not when used to describe other moons. Additionally, when referencing objects such as the Sun, it is also customary to capitalize it. The words 'the earth' would be correct only if referring to the soil or ground, rather than the planet itself.
In the sentence "The earth is the third planet," the word "earth" should not be capitalized unless it's part of a proper noun (like "Earth" when referring to our planet specifically). So, "earth" should be lowercase.