Updating from one OS to a newer version

Presently I have a Windows PC. Now with Windows, whichever version of Windows my pc has on it, if I later want to put a new OS onto it, I have to install the newer OS, but in doing that, it wipes the hard drive, which then means I have to reinstall all my program's and set them up to my liking etc.
I was wondering with Mac. If for example I had an iMac that had for example Snow Leopard, Lion. If I wanted to update the OS to Mountain Lion. Would upgrading to Moutain Lion wipe the hard drive and in doing that remove all my applications and anything else that had been installed?
Or is it possible with Mac to slip stream (for want of a better word) a newer OS onto the Mac and leave the applications etc that were previously installed intact and untouched?
Thanks in advance.

Just to update this post and ask another question
In January of this year I bought my first Mac (Late 2012 iMac 27 inch) and I absolutely love it. The move from Windows to Mac has been an absolute pleasure and I only wish I'd done it earlier.
To follow on from my original question:
Some people recommend that when updating to a new OS, that its best to do a fresh install and in doing so erase all what's on the hard drive. The reason been is to replace any left over files that might cause issue or not play nice with the new OS.
I was wondering if any of the long term Mac users could give their experiences of whether its best to just update the OS and leave everything else untouched and if they've done this have they had issues with leftover files etc from the old OS.

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