A legal firm says it has taken forward six defamation actions involving Facebook in the last nine months.
Hugh James solicitors in Cardiff told BBC Radio Wales it also receives phone inquiries about the social networking site from all parts of Wales weekly.
The six cases involved unfounded allegations, false Facebook profiles, and altered or cropped photos.
Facebook has responded to concerns over privacy by giving people more control over who sees what.
"Everyone can be a publisher now," said commercial litigation lawyer Tracey Singlehurst-Ward.
"What appears to them to be a throwaway remark could actually cause a huge impact", she told BBC Radio Wales' Eye On Wales programme.
"Once it's written down there on the page of the internet for all to see, and literally a huge audience to see, it's there, it's permanent, and the damage is done."
Ms Singlehurst-Ward said one example involved someone working with children.
She said: "An associate of hers who wasn't a friend wrote on something called the wall, making allegations of violence against this woman.
"That escalated because the employer and her regulatory body saw those comments. It resulted in a huge investigation."
In this case, the woman was fully acquitted, and the case was settled out of court.
The settlement involved retractions and written apologies to every person who was a potential employer.
In England and Wales, a statement is regarded as published where it is read. Although Facebook is an American site, if the statement is read or seen on a computer screen in Wales, for example, that is where an action can be brought.
In addition, websites such as Facebook and Google expose themselves to an action if they refuse to take down a defamatory comment.
In most cases, they will err on the side of caution, and once notified, they will remove a defamatory comment.
For those who are unable to afford the high costs of taking a defamation case to court, a new breed of business is growing in the UK - reputation managers.
They claim that they can repair the damage done to a client's online reputation by using something known as search engine optimisation.
This involves manipulation of data such as key words to lift positive content about a client to the top of a search.
Nathan Barker runs a company called Reputation 24/7 in Liverpool, and said his client base had changed considerably with the rise of Facebook.
He said: "75% is now business to business, and 25% is now the individual coming for help, mostly to do with the break down of relationships.
"If I was to predict the business going forward to January and February of next year, I'd say we will probably be half business to business, and half business to consumers and members of the public".
Facebook now has half a billion users worldwide.
Smart mobile phones have seen its take-up more than double in the UK over the last two years. In Indonesia, its take-up has increased by 8,000% over the last two years.
It has responded to rising concerns over privacy by recently ushering in a system designed to give people more control over who sees what.
However, once something is published on the internet, it can be taken and published on countless other websites, and it can be archived for ever.
Will McInnes, who runs a social media consultancy firm in Brighton, said: "It's not enough to point at the giant in the corner and say that you need to make this better.
"We need to get these notions and ideas of privacy in the digital age into the classroom and the workplace.
"Until we as users get it, we're not going to get the progress we're really looking for."
Eye On Wales is on BBC Radio Wales on Sunday, 24 October at 1300 BST.