Community members started asking for a web interface.Newmark registered "craigslist.org", and the website went live in 1996.

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It became a web-based service in 1996 and expanded into other classified categories. Having observed people helping one another in friendly, social, and trusting communal ways on the Internet via the WELL, Mind Vox and Usenet, and feeling isolated as a relative newcomer to San Francisco, Craigslist founder Craig Newmark decided to create something similar for local events.

In early 1995, he began an email distribution list to friends.

In June 2012, Craigslist changed its terms of service to disallow the practice. The site is considered particularly useful by lesbians and gay men seeking to make connections, because of the service's free and open nature and because of the difficulty of otherwise finding each other in more conservative areas.

The company has been pressured by San Francisco Department of Public Health officials, prompting Jim Buckmaster to state that the site has a very small staff and that the public "must police themselves".

Matt Zimmerman, senior staff attorney for the Electronic Frontier Foundation, said, "Craigslist isn't legally culpable for these posts, but the public pressure has increased and Craigslist is a small company." Brian Carver, attorney and assistant professor at UC Berkeley, said that legal threats could have a chilling effect on online expression.

"If you impose liability on Craigslist, You Tube and Facebook for anything their users do, then they're not going to take chances.

It would likely result in the takedown of what might otherwise be perfectly legitimate free expression." Craigslist announced on September 15, 2010, that it had closed its adult services in the United States for good.

However, it defended its right to carry such ads and its efforts to fight prostitution and sex trafficking.

In January 2000, current CEO Jim Buckmaster joined the company as lead programmer and CTO.