The two companies said Friday that the deal will allow them to share "expertise, resources and creativity" on behalf of their online communities. Craigslist lets people post or trade information about jobs, apartments and items for sale in 45 cities.
Financial terms of the deal were not disclosed, but eBay said the acquisition will not have any impact on its third-quarter or 2004 financial results.
Craigslist was launched by Craig Newmark in 1995 in San Francisco. Newmark stopped carrying advertisements on his site in 1997 to keep his down-home feel, although he has since started charging employers fees to post jobs in some cities.
"Although I never figured that part of Craigslist might be owned by a public company, Meg Whitman and (eBay founder) Pierre Omidyar showed that they were interested in us for all the right reasons," Newmark said in a posting on his Web log.
One of the strongest features of the Web has been the ability to, whether for eBay items, Match.com's relationships, or Craigslist's grab bag of locally advertised goods and services.
Driving many of these online successes has been consumers' seemingly insatiable desire to save a few dollars, or--whenever possible--pay nothing at all.
"Craigslist is an excellent example of how the Internet brings people together," Meg Whitman, CEO of eBay, said in a statement. "Whether it's to trade goods, help neighbors or speak out on important issues, Craigslist has become the online gathering place for local communities."
CNET News.com's John Borland contributed to this report.